As filed with the Securities and Exchange Commission on December 27, 2019
1933 Act File No. 333-150525
1940 Act File No. 811-22201
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20543
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 |
☒ | |||
Pre-Effective Amendment No. | ☐ | |||
Post-Effective Amendment No. 253 and/or |
☒ | |||
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 |
☒ | |||
Amendment No. 255 | ☒ |
(Check appropriate box or boxes.)
DIREXION SHARES ETF TRUST
(Exact name of Registrant as Specified in Charter)
1301 Avenue of the Americas (6th Avenue), 28th Floor
New York, New York 10019
(Address of Principal Executive Office) (Zip Code)
Registrants Telephone Number, including Area Code: (646) 572-3390
Daniel D. ONeill, Chief Executive Officer
1301 Avenue of the Americas (6th Avenue), 28th Floor
New York, New York 10019
(Name and Address of Agent for Service)
Copy to:
Angela Brickl | Stacy L. Fuller | |
Rafferty Asset Management, LLC | K&L Gates LLP | |
1301 Avenue of the Americas (6th Avenue) | 1601 K Street, NW | |
28th Floor | Washington, DC 20006 | |
New York, New York 10019 |
It is proposed that this filing will become effective (check appropriate box)
☐ |
immediately upon filing pursuant to paragraph (b) |
☐ |
On (date) pursuant to paragraph (b) |
☒ |
60 days after filing pursuant to paragraph (a)(1) |
☐ |
On (date) pursuant to paragraph (a)(1) |
☐ |
75 days after filing pursuant to paragraph (a)(2) |
☐ |
on (date) pursuant to paragraph (a)(2) of Rule 485. |
If appropriate, check the following box:
☐ |
This post-effective amendment designates a new effective date for a previously filed post-effective amendment. |
DIREXION SHARES ETF TRUST
CONTENTS OF REGISTRATION STATEMENT
This registration document is comprised of the following:
Cover Sheet;
Contents of Registration Statement:
Prospectus and Statement of Additional Information for the Direxion All Cap Insider Sentiment Shares;
Part C of Form N-1A;
Signature Page; and
Exhibits.
1301 Avenue of the Americas (6th Avenue), 28th Floor | New York, New York 10019 | 866-476-7523 |
Management Fees(1) | 0.40% |
Distribution and/or Service (12b-1) Fees | 0.00% |
Other Expenses (Operating Services Fees)(2) | [ ]% |
Total Annual Fund Operating Expenses | [ ]% |
(1) | Rafferty Asset Management, LLC (“Rafferty” or the “Adviser”) has approved an additional reduction of the Management Fee by 0.09% to 0.31% of average daily net assets when the net assets of the Fund are equal to or greater than $500 million. |
(2) | Rafferty has entered into an Operating Services Agreement with the Fund. Under this Operating Services Agreement, Rafferty has contractually agreed to pay all expenses of the Fund through September 1, 2021 other than the following: management fees, Rule 12b-1 distribution and/or service fees, taxes, swap financing and related costs, dividends or interest on short positions, other interest expenses, brokerage commissions, expenses incurred in connection with any merger or reorganization, acquired fund fees and expenses, and extraordinary expenses. The Operating Services Agreement may be terminated at any time by the Board of Trustees. |
1 Year | 3 Years | 5 Years | 10 Years |
$[ ] | $[ ] | $[ ] | $[ ] |
1 | Direxion Shares ETF Trust Prospectus |
Direxion Shares ETF Trust Prospectus | 2 |
3 | Direxion Shares ETF Trust Prospectus |
1 Year | 5 Years |
Since
Inception (12/8/2011) |
|
Return Before Taxes | [ ]% | [ ]% | [ ]% |
Return After Taxes on Distributions | [ ]% | [ ]% | [ ]% |
Return After Taxes on Distributions and Sale of Fund Shares | [ ]% | [ ]% | 9.04% |
Sabrient Multi-Cap Insider/Analyst Quant-Weighted Index (reflects no deduction for fees, expenses or taxes) | [ ]% | [ ]% | [ ]% |
S&P 500® Index (reflects no deduction for fees, expenses or taxes) | -4.38% | 8.49% | 12.55% |
Portfolio Managers | Years of Service with the Fund | Primary Title |
Paul Brigandi | Since Inception in December 2011 | Portfolio Manager |
Tony Ng | Since September 2015 | Portfolio Manager |
Direxion Shares ETF Trust Prospectus | 4 |
5 | Direxion Shares ETF Trust Prospectus |
Direxion Shares ETF Trust Prospectus | 6 |
7 | Direxion Shares ETF Trust Prospectus |
Direxion Shares ETF Trust Prospectus | 8 |
9 | Direxion Shares ETF Trust Prospectus |
Direxion Shares ETF Trust Prospectus | 10 |
11 | Direxion Shares ETF Trust Prospectus |
* | As a percentage of the amount invested. |
Direxion Shares ETF Trust Prospectus | 12 |
13 | Direxion Shares ETF Trust Prospectus |
Direxion Shares ETF Trust Prospectus | 14 |
15 | Direxion Shares ETF Trust Prospectus |
Direxion Shares ETF Trust Prospectus | 16 |
17 | Direxion Shares ETF Trust Prospectus |
1301 Avenue of the Americas (6th Avenue), 28th Floor | New York, New York 10019 | 866-476-7523 |
Write to: | Direxion Shares ETF Trust |
1301 Avenue
of the Americas (6th Avenue), 28th Floor
New York, New York 10019 |
|
Call: | 866-476-7523 |
By Internet: | www.direxion.com |
1301 Avenue of the Americas (6th Avenue), 28th Floor | New York, New York 10019 | 866-476-7523 |
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A-1 |
• | Adversely impact the pricing, liquidity, value of, return on and trading for a broad array of financial products, including any LIBOR-linked securities, loans and derivatives in which the Fund may invest; |
• | Require extensive negotiations of and/or amendments to agreements and other documentation governing LIBOR-linked investments products; |
• | Lead to disputes, litigation or other actions with counterparties or portfolio companies regarding the interpretation and enforceability of “fall back” provisions that provide for an alternative reference rate in the event of LIBOR’s unavailability; or |
• | Cause the Fund to incur additional costs in relation to any of the above factors. |
1. | Borrow money, except to the extent permitted by the 1940 Act, the rules and regulations thereunder and any applicable exemptive relief. |
2. | Issue senior securities, except to the extent permitted by the 1940 Act, the rules and regulations thereunder and any applicable exemptive relief. |
3. | Make loans, except to the extent permitted by the 1940 Act, the rules and regulations thereunder and any applicable exemptive relief. |
4. | Purchase or sell real estate, except that, to the extent permitted by applicable law, the Fund may (a) invest in securities or other instruments directly secured by real estate, and (b) invest in securities or other instruments issued by issuers that invest in real estate. |
5. | Purchase or sell commodities or commodity contracts unless acquired as a result of ownership of securities or other instruments issued by persons that purchase or sell commodities or commodities contracts; but this shall not prevent the Fund from purchasing, selling and entering into financial futures contracts (including futures contracts on indices of securities, interest rates and currencies), and options on financial futures contracts (including futures contracts on indices of securities, interest rates and currencies), warrants, swaps, forward contracts, foreign currency spot and forward contracts and other financial instruments. |
6. | Underwrite securities issued by others, except to the extent that the Fund may be considered an underwriter within the meaning of the 1933 Act in the disposition of restricted securities or other investment company securities. |
7. | Except for any Fund that is “concentrated” in an industry or group of industries within the meaning of the 1940 Act, purchase the securities of any issuer (other than securities issued or guaranteed by the U.S. government or any of its agencies or instrumentalities) if, as a result, 25% or more of the Fund’s total assets would be invested in the securities of companies whose principal business activities are in the same industry. However, the Fund will only concentrate its investment in a particular industry or group of industries to approximately the same extent as the Index is so concentrated. |
Direxion All Cap Insider Sentiment Shares | Brokerage Fees Paid |
Year Ended October 31, 2019 | - |
Year Ended October 31, 2018 | $1,055,879 |
Year Ended October 31, 2017 | $894,036 |
Name,
Address
and Age |
Position(s)
Held with Fund |
Term
of
Office and Length of Time Served |
Principal
Occupation(s) During
Past Five Years |
#
of
Portfolios in Direxion Family of Investment Companies Overseen by Trustee(2) |
Other
Trusteeships/ Directorships Held by Trustee During Past Five Years |
Daniel
D. O’Neill(1)
Age: 51 |
Chairman of the Board of Trustees |
Lifetime
of Trust until removal or resignation;
Since 2008 |
Managing
Director of Rafferty Asset Management, LLC, January 1999 – January 2019 and Direxion Advisors, LLC, November 2017
– January 2019.
|
[ ] | None. |
Name,
Address
and Age |
Position(s)
Held with Fund |
Term
of
Office and Length of Time Served |
Principal
Occupation(s) During
Past Five Years |
#
of
Portfolios in Direxion Family of Investment Companies Overseen by Trustee(3) |
Other
Trusteeships/ Directorships Held by Trustee During Past Five Years |
Gerald
E. Shanley III
Age: 75 |
Trustee |
Lifetime
of Trust until removal or resignation;
Since 2008 |
Retired,
since 2002; Business Consultant, 1985-present; Trustee of Trust Under Will of Charles S. Payson, 1987-present; C.P.A., 1979-present.
|
[ ] | None. |
John
A. Weisser
Age: 77 |
Trustee |
Lifetime
of Trust until removal or resignation;
Since 2008 |
Retired, since 1995; Salomon Brothers, Inc., 1971-1995, most recently as Managing Director. | [ ] |
Director
until December 2016: The MainStay Funds Trust, The MainStay Funds, MainStay VP Fund Series, Mainstay Defined Term Municipal Opportunities Fund; Private Advisors Alternative Strategy Fund; Private Advisors Alternative Strategies Master Fund.
|
Name,
Address
and Age |
Position(s)
Held with Fund |
Term
of
Office and Length of Time Served |
Principal
Occupation(s) During
Past Five Years |
#
of
Portfolios in Direxion Family of Investment Companies Overseen by Trustee(3) |
Other
Trusteeships/ Directorships Held by Trustee During Past Five Years |
David
L. Driscoll
Age: 50 |
Trustee |
Lifetime
of Trust until removal or resignation;
Since 2014 |
Partner,
King Associates, LLP, since 2004; Board Advisor, University Common Real Estate, since 2012; Principal, Grey Oaks LLP since 2003; Member, Kendrick LLC, since 2006.
|
[ ] | None. |
Jacob
C. Gaffey
Age: 71 |
Trustee |
Lifetime
of Trust until removal or resignation;
Since 2014 |
Managing
Director of Loomis & Co. since 2012; Partner, Bay Capital Advisors, LLC
2008 – 2012. |
[ ] | None. |
Henry
W. Mulholland
Age: 56 |
Trustee | Lifetime of Trust until removal or resignation; Since 2017 | Grove Hill Partners LLC, since 2016 as Managing Partner; Bank of America Merrill Lynch, 1990-2015, most recently as Managing Director and Head of Equities for Americas. | [ ] | None. |
Kathleen
M. Berkery(3)
Age: 52 |
Trustee | Lifetime of Trust until removal or resignation; Since 2019 | Rynkar, Vail & Barrett, LLC, since 2018 as Manager – Trusts & Estates; Lee, Nolan & Koroghlian Life Planning Group, 2010-2017 as Financial Advisor | [ ] | None. |
(1) | Mr. O’Neill is affiliated with Rafferty and Direxion because he owns a beneficial interest in Rafferty. |
(2) | The Direxion Family of Investment Companies consists of the Direxion Shares ETF Trust which, as of the date of this SAI, offers for sale to the public [ ] of the[ ] funds registered with the SEC, the Direxion Funds which, as of the date of this SAI, offers for sale to the public 15 funds registered with the SEC and the Direxion Insurance Trust which, as of the date of this SAI, does not have any funds registered with the SEC. |
(3) | Ms. Berkery was elected as a Trustee on November 26, 2019. |
Name,
Address
and Age |
Position(s)
Held with Fund |
Term
of
Office and Length of Time Served |
Principal
Occupation(s) During
Past Five Years |
#
of
Portfolios in the Direxion Family of Investment Companies Overseen by Trustee(1) |
Other
Trusteeships/
Directorships Held by Trustee During Past Five Years |
Robert
D. Nestor
Age: 50 |
President |
One
Year;
Since 2018 |
President, Rafferty Asset Management, LLC and Direxion Advisors, LLC, since April 2018; Blackrock, Inc. (May 2007-April 2018), most recently as Managing Director. | N/A | N/A |
Patrick
J. Rudnick
Age: 46 |
Principal
Executive
Officer Principal Financial Officer |
One
Year;
Since 2018 One Year; Since 2010 |
Senior
Vice President, since March 2013, Rafferty Asset Management, LLC; Senior Vice President, since November 2017, Direxion Advisors, LLC.
|
N/A | N/A |
Angela
Brickl
Age: 43 |
Chief
Compliance
Officer Secretary |
One
Year;
Since 2018 One Year; Since 2011 |
General
Counsel, Rafferty Asset Management LLC, since October 2010 and Direxion Advisors, LLC, since November 2017; Chief Compliance Officer, Rafferty Asset Management, LLC, since September 2012 and Direxion Advisors, LLC, since November 2017.
|
N/A | N/A |
(1) | The Direxion Family of Investment Companies consists of the Direxion Shares ETF Trust which, as of the date of this SAI, offers for sale to the public [ ] of the[ ] funds registered with the SEC, the Direxion Funds which, as of the date of this SAI, offers for sale to the public 15 funds registered with the SEC and the Direxion Insurance Trust which, as of the date of this SAI, does not have any funds registered with the SEC. |
Dollar Range of Equity Securities Owned: | Interested Trustee: | Independent Trustees: | |||||
Daniel
D.
O’Neill |
Gerald
E.
Shanley III |
John
Weisser |
David
L.
Driscoll |
Jacob
C.
Gaffey |
Henry
W.
Mulholland |
Kathleen
M. Berkery (2) |
|
Direxion All Cap Insider Sentiment Shares |
Over
$100,000 |
$0 | $0 | $0 | $0 | $0 | $0 |
Aggregate Dollar Range of Equity Securities in the Direxion Family of Investment Companies(1) |
Over
$100,000 |
$0 | $1-$10,000 | $0 | $0 | $0 | $0 |
(1) | The Direxion Family of Investment Companies consists of the Direxion Shares ETF Trust which, as of the date of this SAI, offers for sale to the public [ ] of the[ ] funds registered with the SEC, the Direxion Funds which, as of the date of this SAI, offers for sale to the public 15 funds registered with the SEC and the Direxion Insurance Trust which, as of the date of this SAI, does not have any funds registered with the SEC. |
(2) | Ms. Berkery was appointed as a Trustee on November 26, 2019 and therefore did not have any holdings as of December 31, 2018. |
Name
of Person,
Position |
Aggregate
Compensation From the Trust(1) |
Pension
or
Retirement Benefits Accrued As Part of the Trust’s Expenses |
Estimated
Annual Benefits Upon Retirement |
Aggregate
Compensation From the Direxion Family of Investment Companies Paid to the Trustees(2) |
Interested Trustee | ||||
Daniel D. O’Neill | $0 | $0 | $0 | $0 |
Independent Trustees | ||||
Gerald E. Shanley III | $[ ] | $0 | $0 | $[ ] |
John A. Weisser | $[ ] | $0 | $0 | $[ ] |
David L. Driscoll | $[ ] | $0 | $0 | $[ ] |
Jacob C. Gaffey | $[ ] | $0 | $0 | $[ ] |
Henry W. Mulholland | $[ ] | $0 | $0 | $[ ] |
Kathleen M. Berkery(3) | $0 | $0 | $0 | $0 |
Accounts |
Total
Number
of Accounts |
Total
Assets
(In Billions) |
Total
Number of
Accounts with Performance Based Fees |
Total
Assets
of Accounts with Performance Based Fees |
Registered Investment Companies | [ ] | $ [ ] | 0 | $0 |
Other Pooled Investment Vehicles | 0 | $0 | 0 | $0 |
Other Accounts | 0 | $0 | 0 | $0 |
• | Election of Directors – considering all factors such as director qualifications, term of office and age limits. |
• | Proxy Contests – considering factors such as voting nominees in contested elections and reimbursement of expenses. |
• | Election of Auditors – considering factors such as independence and reputation of the auditing firm. |
• | Proxy Contest Defenses – considering factors such as board structure and cumulative voting. |
• | Tender Offer Defenses – considering factors such as poison pills (stock purchase rights plans) and fair price provisions. |
• | Miscellaneous Governance Issues – considering factors such as confidential voting and equal access. |
• | Capital Structure – considering factors such as common stock authorization and stock distributions. |
• | Executive and Director Compensation – considering factors such as performance goals and employee stock purchase plans. |
• | State of Incorporation – considering factors such as state takeover statutes and voting on reincorporation proposals. |
• | Mergers and Corporate Restructuring – considering factors such as spin-offs and asset sales. |
• | Mutual Fund Proxy Voting – considering factors such as election of directors and proxy contests. |
• | Social and Corporate Responsibility Issues – considering factors such as social, environmental, and labor issues. |
Fees paid to the Administrator | |
Year Ended October 31, 2019 | $[ ] |
Year Ended October 31, 2018 | $2,046,515 |
Year Ended October 31, 2017 | $2,402,024 |
Fees paid to the Fund Accounting Agent | |
Year Ended October 31, 2019 | $[ ] |
Year Ended October 31, 2018 | $1,876,840 |
Year Ended October 31, 2017 | $1,629,992 |
Fees paid to the Custodian | |
Year Ended October 31, 2019 | $[ ] |
Year Ended October 31, 2018 | $1,132,612 |
Year Ended October 31, 2017 | $1,016,661 |
Fees paid to the Transfer Agent | |
Year Ended October 31, 2019 | $[ ] |
Year Ended October 31, 2018 | $1,171,567 |
Year Ended October 31, 2017 | $1,116,750 |
Australia | Austria | Belgium | Brazil | Canada | Chile | China | ||||||
January
1
January 28 April 19 April 22 April 25 June 10 December 24 December 25 December 26 December 31 |
January
1
April 19 April 22 May 1 June 10 December 24 December 25 December 26 December 31 |
January
1
April 19 April 22 May 1 May 30 June 10 August 15 November 1 December 24 December 25 December 26 December 31 |
January
1
January 25 March 4 March 5 March 6 April 19 May 1 June 20 July 9 November 15 November 20 December 25 |
January
1
January 2 February 18 April 19 May 20 June 24 July 1 August 5 September 2 October 14 November 11 December 25 December 26 |
January
1
April 19 May 1 May 21 July 16 August 15 September 18 September 19 September 20 October 31 November 1 December 25 December 31 |
January
1
January 21 February 4 February 5 February 6 February 7 February 8 February 18 April 5 April 19 April 22 May 1 May 13 May 27 June 7 July 1 July 4 September 2 September 13 October 1 October 2 October 3 October 4 October 7 October 14 November 11 November 28 December 25 December 26 |
Colombia | Czech Republic | Denmark | Egypt | Finland | France | Germany | ||||||
January
1
January 7 March 25 April 18 April 19 May 1 June 3 June 24 July 1 August 7 August 19 October 14 November 4 November 11 December 25 |
January
1
April 19 April 22 May 1 May 8 July 5 October 28 December 24 December 25 December 26 |
January
1
April 18 April 19 April 22 May 1 May 17 May 30 May 31 June 5 June 10 December 24 December 25 December 26 December 31 |
January
1
January 7 April 25 April 28 April 29 May 1 June 4 June 5 July 1 July 23 August 11 August 12 October 6 |
January
1
April 19 April 22 May 1 May 30 June 21 December 6 December 24 December 25 December 26 December 31 |
January
1
April 19 April 22 May 1 May 30 June 10 August 15 November 1 November 11 December 24 December 25 December 26 December 31 |
January
1
April 19 April 22 May 1 May 30 June 10 June 20 August 15 October 3 October 31 November 1 November 20 December 24 December 25 December 26 December 31 |
Greece | Hong Kong | Hungary | India | Indonesia | Ireland | Israel | ||||||
January
1
March 11 March 25 April 19 April 22 April 26 April 29 May 1 June 17 August 15 October 28 December 24 December 25 December 26 |
January
1
February 4 February 5 February 6 February 7 April 5 April 19 April 22 May 1 May 13 June 7 July 1 October 1 October 7 December 24 December 25 December 26 December 31 |
January
1
March 15 April 19 April 22 May 1 June 10 August 10 August 19 August 20 October 23 November 1 December 7 December 14 December 24 December 25 December 26 December 27 December 31 |
February
19
March 4 March 21 April 1 April 17 April 19 May 1 June 5 August 12 August 15 September 2 September 10 October 2 October 8 October 28 November 12 December 25 |
January
1
February 5 March 7 April 3 April 19 May 1 May 30 June 3 June 4 June 5 June 6 June 7 December 24 December 25 December 31 |
January
1
January 21 February 18 March 18 April 19 April 22 May 1 May 6 May 27 June 3 July 4 August 5 August 26 September 2 October 14 October 28 November 11 November 28 December 24 December 25 December 26 December 31 |
March
21
April 21 April 22 April 23 April 24 April 25 April 26 May 8 May 9 June 9 August 11 September 29 September 30 October 1 October 8 October 9 October 13 October 14 October 15 October 16 October 17 October 20 October 21 |
Italy | Japan | Korea | Malaysia | Mexico | Morocco | The Netherlands | ||||||
January
1
April 19 April 22 May 1 August 15 December 24 December 25 December 26 December 31 |
January
1
January 2 January 3 January 14 February 11 March 21 April 29 April 30 May 1 May 2 May 3 May 6 July 15 August 12 September 16 September 23 October 14 October 22 November 4 December 31 |
January
1
February 4 February 5 February 6 March 1 May 1 May 6 June 6 August 15 September 12 September 13 October 3 October 9 December 25 December 31 |
January
1
January 21 February 1 February 4 February 5 February 6 May 1 May 20 May 22 June 4 June 5 June 6 August 12 September 2 September 9 September 16 October 28 December 25 |
January
1
February 4 March 18 April 18 April 19 May 1 September 16 November 18 December 12 December 25 |
January
1
January 11 May 1 June 4 June 5 July 30 August 12 August 13 August 14 August 20 August 21 September 2 November 6 November 11 November 12 November 18 |
January
1
April 19 April 22 May 1 May 30 June 10 November 1 December 24 December 25 December 26 December 31 |
New Zealand | Norway | Peru | Philippines | Poland | Portugal | Russia | ||||||
January
1
January 2 January 21 January 28 February 6 April 19 April 22 April 25 June 3 October 28 December 25 December 26 |
January
1
April 17 April 18 April 19 April 22 May 1 May 17 May 30 June 10 December 24 December 25 December 26 December 31 |
January
1
April 18 April 19 May 1 July 29 August 30 October 8 November 1 December 25 |
January
1
February 5 February 25 April 9 April 18 April 19 May 1 June 12 August 21 August 26 November 1 December 24 December 25 December 30 December 31 |
January
1
April 19 April 22 May 1 May 3 June 20 August 15 November 1 November 11 December 24 December 25 December 26 December 31 |
January
1
April 19 April 22 April 25 May 1 June 10 June 13 June 20 August 15 November 1 December 25 December 26 |
January
1
January 2 January 3 January 4 January 7 January 8 March 8 May 1 May 2 May 3 May 9 May 10 June 12 November 4 |
Singapore | South Africa | Spain | Sweden | Switzerland | Taiwan | Thailand | ||||||
January
1
February 4 February 5 February 6 April 19 May 1 May 20 June 5 August 9 August 12 October 28 December 25 |
January
1
March 21 April 19 April 22 May 1 June 17 August 9 September 24 December 16 December 25 December 26 |
January
1
March 19 April 18 April 19 April 22 May 1 August 15 November 1 December 6 December 25 December 26 |
January
1
April 18 April 19 April 22 April 30 May 1 May 29 May 30 November 1 December 24 December 25 December 26 December 31 |
January
1
January 2 April 8 April 19 April 22 May 1 May 30 June 10 August 1 September 9 December 24 December 25 December 26 December 31 |
January
1
January 31 February 1 February 4 February 5 February 6 February 7 February 8 February 28 March 1 April 4 April 5 May 1 June 7 September 13 October 10 October 11 |
January
1
February 19 April 8 April 15 April 16 May 1 May 20 July 16 July 29 August 12 October 14 October 23 December 5 December 10 December 31 |
Turkey | United Kingdom | |
January
1
April 23 May 1 June 3 June 4 June 5 June 6 July 15 August 12 August 13 August 14 August 30 October 28 October 29 |
January
1
January 21 February 18 April 19 April 22 May 1 May 6 May 27 July 4 August 26 September 2 October 14 November 11 November 28 December 24 December 25 December 26 December 31 |
Utilized
in
Current Year |
Expiring
October 31, 2019 |
Unlimited
Short-Term |
Unlimited
Long-Term |
|
Fund | ||||
Direxion All Cap Insider Sentiment Shares | $[ ] | $[ ] | $[ ] | $[ ] |
Write to: |
Direxion
Shares ETF Trust
1301 Avenue of the Americas (6th Avenue), 28th Floor New York, New York 10019 |
Call: | 866-476-7523 |
By Internet: | www.direxion.com |
• | The likelihood of payment--the capacity and willingness of the obligor to meet its financial commitments on an obligation in accordance with the terms of the obligation; |
• | The nature and provisions of the financial obligation, and the promise we impute; and |
• | The protection afforded by, and relative position of, the financial obligation in the event of a bankruptcy, reorganization, or other arrangement under the laws of bankruptcy and other laws affecting creditors' rights. |
• | Amortization schedule--the larger the final maturity relative to other maturities, the more likely it will be treated as a note; and |
• | Source of payment--the more dependent the issue is on the market for its refinancing, the more likely it will be treated as a note. |
(a) | Subject to the exceptions and limitations contained in subsection (b) below: |
(i) | every person who is, or has been, a Trustee or an officer, employee or agent of the Trust, including persons who act at the request of the Trust as directors, trustees, officers, employees or agents of another organization in which the Trust has an interest as a shareholder, creditor or otherwise (“Covered Person”) shall be indemnified by the Trust or the appropriate Series to the fullest extent permitted by law against liability and against all expenses reasonably incurred or paid by him or her in connection with any claim, action, suit or proceeding in which he or she becomes involved as a party or otherwise by virtue of his or her being or having been a Covered Person and against amounts paid or incurred by him or her in the settlement thereof. |
(ii) | as used herein, the words “claim,” “action,” “suit” or “proceeding” shall apply to all claims, actions, suits or proceedings (civil, criminal or other, including appeals), actual or threatened, and the words “liability” and “expenses” shall include, without limitation, counsel fees, costs, judgments, amounts paid in settlement, fines, penalties and other liabilities. |
(b) | No indemnification shall be provided hereunder to a Covered Person: |
(i) | who shall have been adjudicated by a court or body before which the proceeding was brought (A) to be liable to the Trust or its Shareholders by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of his or her office or (B) not to have acted in good faith in the reasonable belief that his or her action was in the best interest of the Trust; or |
(ii) | in the event of a settlement, if there has been a determination that such Covered Person engaged in willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of his or her office: (A) by the court or other body approving the settlement; (B) by at least a majority of those Trustees who are neither Interested Persons of the Trust nor are parties to the matter based upon a review of readily available facts (as opposed to a full trial-type inquiry); or (C) by written opinion of independent legal counsel based upon a review of readily available facts (as opposed to a full trial-type inquiry). |
(c) | The rights of indemnification herein provided may be insured against by policies maintained by the Trust, shall be severable, shall not be exclusive of or affect any other rights to which any Covered Person may now or hereafter be entitled and shall inure to the benefit of the heirs, executors and administrators of a Covered Person. Nothing contained herein shall affect any rights to indemnification to which Trust personnel other than Covered Persons may be entitled by contract or otherwise under law. |
(d) | To the maximum extent permitted by applicable law, expenses in connection with the preparation and presentation of a defense to any claim, action, suit or proceeding of the character described in subsection (a) of this Section shall be paid by the Trust or applicable Series from time to time prior to final disposition thereof upon receipt of an undertaking by or on behalf of such Covered Person that such amount will be paid over by him or her to the Trust or applicable Series if it is ultimately determined that he or she is not entitled to indemnification under this Section. |
(e) | Any repeal or modification of this Article IX by the Shareholders, or adoption or modification of any other provision of this Trust Instrument or the By-laws inconsistent with this Article, shall be prospective only, to the extent that such, repeal or modification would, if applied retrospectively, adversely affect any limitation on the liability of any Covered Person or indemnification available to any Covered Person with respect to any act or omission which occurred prior to such repeal, modification or adoption. |
(a) | The Trust agrees to indemnify and hold harmless the Distributor, its affiliates and each of their directors, officers and employees and agents and any person who controls the Distributor within the meaning of Section 15 of the 1933 Act (any of the Distributor, its officers, employees, agents and directors or such control persons, for purposes of this paragraph, a “Distributor Indemnitee”) against any loss, liability, claim, damages or expense (including the reasonable cost of investigating or defending any alleged loss, liability, claim, damages or expense |
and reasonable counsel fees incurred in connection therewith) arising out of or based upon (i) any claim that the Registration Statement, Prospectus, Statement of Additional Information, Product Description, shareholder reports, sales literature and advertisements specifically approved by the Trust and Investment Adviser or other information filed or made public by the Trust (as from time to time amended) included an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein (and in the case of the Prospectus, Statement of Additional Information and Product Description, in light of the circumstances under which they were made) not misleading under the 1933 Act, or any other statute or the common law, (ii) the breach by the Trust of any obligation, representation or warranty contained in this Agreement or (iii) the Trust's failure to comply in any material respect with applicable securities laws. |
(b) | The Distributor agrees to indemnify and hold harmless the Trust and each of its Trustees and officers and any person who controls the Trust within the meaning of Section 15 of the 1933 Act (for purposes of this paragraph, the Trust and each of its Trustees and officers and its controlling persons are collectively referred to as the “Trust Affiliates”) against any loss, liability, claim, damages or expense (including the reasonable cost of investigating or defending any alleged loss, liability, claim, damages or expense and reasonable counsel fees incurred in connection therewith) arising out of or based upon (i) the allegation of any wrongful act of the Distributor or any of its directors, officers, employees, (ii) the breach of any obligation, representation or warranty pursuant to this Agreement by the Distributor, (iii) the Distributor's failure to comply in any material respect with applicable securities laws, including applicable FINRA regulations, or (iv) any allegation that the Registration Statement, Prospectus, Statement of Additional Information, Product Description, shareholder reports, any information or materials relating to the Funds (as described in section 3(g)) or other information filed or made public by the Trust (as from time to time amended) included an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements not misleading, insofar as such statement or omission was made in reliance upon, and in conformity with information furnished to the Trust by or on behalf of the Distributor, it being understood that the Trust will rely upon certain information provided by the Distributor for use in the preparation of the Registration Statement, Prospectus, Statement of Additional Information, Product Description, shareholder reports or other information relating to the Funds or made public by the Trust. |
(c) | No indemnified party shall settle any claim against it for which it intends to seek indemnification from the indemnifying party, under the terms of section 6(a) or 6(b) above, without the prior written notice to and consent from the indemnifying party, which consent shall not be unreasonably withheld. No indemnified or indemnifying party shall settle any claim unless the settlement contains a full release of liability with respect to the other party in respect of such action. This section 6 shall survive the termination of this Agreement. |
(a) | The Participant hereby agrees to indemnify and hold harmless the Distributor, the Funds, the Index Receipt Agent, their respective subsidiaries, affiliates, directors, officers, employees, and agents, and each person, if any, who controls such persons within the meaning of Section 15 of the 1933 Act (each an “Indemnified Party”), from and against any loss, liability, cost, or expense (including attorneys’ fees) incurred by such Indemnified Party as a result of (i) any breach by the Participant of any provision of this Agreement; (ii) any failure on the part of the Participant to perform any of its obligations set forth in this Agreement; (iii) any failure by the Participant to comply with applicable laws, including rules and regulations of self-regulatory organizations; (iv) actions of such Indemnified Party in reliance upon any instructions issued in accordance with the Fund Documents, AP Handbook or Annex II (as each may be amended from time to time) reasonably believed by the Distributor and/or the Index Receipt Agent to be genuine and to have been given by the Participant; or (v) the Participant’s failure to complete a Purchase Order or Redemption Order that has been accepted. The Participant understands and agrees that the Funds as third party beneficiaries to this Agreement are entitled to proceed directly against the Participant in the event that the Participant fails to honor any of its obligations under this Agreement that benefit the Fund. The Distributor shall not be liable to the Participant for any damages arising out of mistakes or errors in data provided to the Distributor, or out of interruptions or delays of communications with the Indemnified Parties who are service providers to the Fund, nor is the Distributor liable for any action, representation, or solicitation made by the wholesalers of the Fund. |
(b) | The Distributor hereby agrees to indemnify and hold harmless the Participant and the Index Receipt Agent, their respective subsidiaries, affiliates, directors, officers, employees, and agents, and each person, if any, who controls such persons within the meaning of Section 15 of the 1933 Act (each an “Indemnified Party”), from and against any loss, liability, cost, or expense (including attorneys’ fees) incurred by such Indemnified Party as a result of (i) any breach by the Distributor of any provision of this Agreement; (ii) any failure on the part of the Distributor to perform any of its obligations set forth in this Agreement; (iii) any failure by the Distributor to comply with applicable laws, including rules and regulations of self-regulatory organizations; or (iv) actions of such Indemnified Party in reliance upon any representations made in accordance with the Fund Documents and AP Handbook (as e ach may be amended from time to time) reasonably believed by the Participant to be genuine and to have been given by the Distributor. The Participant shall not be liable to the Distributor for any damages arising out of mistakes or errors in data provided to the Participant, or out of interruptions or delays of communications with the Indemnified Parties who are service providers to the Fund, nor is the Participant liable for any action, representation, or solicitation made by the wholesalers of the Fund. |
(c) | The Funds, the Distributor, the Index Receipt Agent, or any person who controls such persons within the meaning of Section 15 of the 1933 Act, shall not be liable to the Participant for any damages arising from any differences in performance between the Deposit Securities in a Fund Deposit and the Fund’s benchmark index. |
Name | Business Address |
Position
with
Underwriter |
Position
with
Registrant |
Richard J. Berthy |
Three
Canal Plaza,
Suite 100, Portland, Maine 04101 |
President,
Treasurer
and Manager |
None |
Mark A. Fairbanks |
Three
Canal Plaza,
Suite 100, Portland, Maine 04101 |
Vice President | None |
Jennifer K. DiValerio |
899
Cassatt Road,
400 Berwyn Park, Suite 110, Berwyn, PA 19312 |
Vice President | None |
Nanette K. Chern |
Three
Canal Plaza,
Suite 100, Portland, Maine 04101 |
Vice
President
and Chief Compliance Officer |
None |
Jennifer E. Hoopes |
Three
Canal Plaza,
Suite 100, Portland, Maine 04101 |
Secretary | None |
DIREXION SHARES ETF TRUST | |
By: | /s/ Patrick J. Rudnick* |
Patrick J. Rudnick | |
Principal Executive Officer |
Signature | Title | Date |
/s/ Daniel D. O’Neill* | Chairman of the Board | December 27, 2019 |
Daniel D. O’Neill | ||
/s/ Gerald E. Shanley III* | Trustee | December 27, 2019 |
Gerald E. Shanley III | ||
/s/ John Weisser* | Trustee | December 27, 2019 |
John Weisser | ||
/s/ Jacob C. Gaffey* | Trustee | December 27, 2019 |
Jacob C. Gaffey | ||
/s/ David L. Driscoll* | Trustee | December 27, 2019 |
David L. Driscoll | ||
/s/ Henry W. Mulholland* | Trustee | December 27, 2019 |
Henry W. Mulholland | ||
/s/ Kathleen M. Berkery* | Trustee | December 27, 2019 |
Kathleen M. Berkery | ||
/s/ Patrick J. Rudnick* |
Principal
Executive Officer
and Principal Financial Officer |
December 27, 2019 |
Patrick J. Rudnick | ||
*By: /s/ Angela Brickl |
Exhibit
Number |
Description |
(j)(ii) | Power of Attorney and Certified Resolutions |
(p) | Code of Ethics |
POWER OF ATTORNEY
The undersigned trustee of the DIREXION SHARES ETF TRUST, a Delaware statutory trust (the Trust), hereby nominates, constitutes and appoints Angela Brickl as her true and lawful attorney-in-fact and agent, for her and on her behalf and in her name, place and stead in any and all capacities, to make, execute and sign the Trusts registration statement on Form N-1A (Registration Statement) under the Securities Act of 1933, as amended, and the Investment Company Act of 1940, as amended, and any and all amendments to such Registration Statement and to file with the Securities and Exchange Commission, and any other regulatory authority having jurisdiction over the offer and sale of shares of the beneficial interest of the Trust, any such Registration Statement or amendment, and any and all supplements thereto or to any prospectus or statement of additional information forming a part thereof, and any and all exhibits and other documents requisite in connection therewith, granting unto said attorney full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises as fully to all intents and purposes as the Trust and the undersigned officers and trustees itself/themselves might or could do.
IN WITNESS WHEREOF, DIREXION SHARES ETF TRUST has caused this power of attorney to be executed in its name by its Chairman of the Board, and attested by its Principal Executive Officer, and the undersigned officers and trustees have hereunto set their hands and seals at New York City, New York this 26th day of November 2019.
DIREXION SHARES ETF TRUST | ||
By: |
/s/ Daniel D. ONeill |
|
Name: | Daniel D. ONeill | |
Title: | Chairman of the Board |
Signature |
Title |
|
/s/ Kathleen M. Berkery |
||
Kathleen M. Berkery | Trustee | |
/s/ Patrick J. Rudnick |
||
Patrick J. Rudnick | Principal Executive Officer |
VOTED: that the trustee of the ETF Trust, hereby nominates, constitutes and appoints Angela Brickl her true and lawful attorney in fact and agent, for her and on her behalf and in her name, place and stead in any and all capacities, to make, execute and sign the ETF Trusts registration statement on Form N-1A (each, a Registration Statement) under the Securities Act of 1933, and the Investment Company Act of 1940, and any and all amendments to such Registration Statement of the ETF Trust, and to file with the Securities and Exchange Commission, and any other regulatory authority having jurisdiction over the offer and sale of the shares of beneficial interest of the ETF Trust, any such Registration Statement or amendments, and any and all supplements thereto or to any prospectus or statement of additional information forming a part thereof, and any and all exhibits and other documents requisite in connection therewith, granting unto said attorney full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises as fully to all intents and purposes as the Trust and its officers and trustees itself/themselves might or could do; and it is
/s/ Angela Brickl |
Angela Brickl |
Chief Compliance Officer and Secretary of the Trust |
Dated: November 26, 2019 |
Direxion Shares ETF Trust, Direxion Funds
Direxion Insurance Trust,
Rafferty Asset Management, LLC
Direxion Advisors LLC
Code of Ethics
Effective: December 1, 2019
I. |
Introduction |
This code of ethics (Code) has been adopted by Direxion Funds, Direxion Insurance Trust, and Direxion Shares ETF Trust (together, the Trusts, each a Trust) and Rafferty Asset Management, LLC and Direxion Advisors, LLC (each an Advisor and collectively, the Advisors:) in compliance with Rule 17j-1 under the Investment Company Act of 1940, as amended (the 1940 Act) and Section 204A-1 under the Investment Advisers Act of 1940, as amended (the Advisers Act). Unless otherwise defined, terms that are capitalized in this Code have the meanings set forth in Section VII.
This Code applies to all Access Persons which includes any of the following persons in connection with their duties to the Trusts or the Advisors: (1) an interested trustee; (2) a director; (3) an officer; (4) an employee (including an employee of a company in a control relationship with the Trusts or the Advisors) who, in connection with his or her regular job functions or duties, makes, participates in, or obtains information regarding the purchase or sale of a Security by the Trust, or whose functions relate to the making of any recommendation with respect to such purchases or sales; and (5) any natural person in a control relationship who obtains information concerning the recommendations made to the Trust with respect to the purchase and sale of Securities by the Trust.
Independent Trustees of the Trusts are not subject to this Code, provided that any such persons are subject to a code of ethics that is compliant with the terms of Rule 17j-1 adopted by the Trusts.
This Code is based on the principle that Access Persons have a duty to place the interests of the Advisors clients, the Trusts and investors in the Trusts (together, Clients) ahead of their own interests. Access Persons must act with integrity and good faith at all times, but particularly when their personal interests may conflict with the interests of Clients. As such, Access Persons must:
|
Place the interests of Clients first; |
|
Not take inappropriate advantage of their positions with the Trusts or the Advisors; and |
|
Conduct all personal Securities Transactions in full compliance with this Code. |
Receipt of this Code satisfies the Advisors obligation to notify all Access Persons of their reporting obligations under Rule 17j-1(d)(4) of the 1940 Act. Access Persons must promptly report any violation of this Code to Advisors Chief Compliance Officer (the CCO).
Access Persons should direct any questions with respect to the Code to Compliance at compliancedirexion@direxion.com.
1
II. |
Standards of Conduct |
Access Persons, in connection with the purchase or sale, either directly or indirectly, of a Security held or to be acquired by a Fund shall not:
1. |
make any oral or written statements, including those made to Clients, prospective clients, or their representatives that are inaccurate or misleading in any way; |
2. |
defraud any Client in any manner; |
3. |
do anything that would have the effect of defrauding or deceiving any Client; |
4. |
falsify a material fact to any Client; |
5. |
omit to state a material fact to any Client in any communication if the fact is necessary to ensure that such communication is not misleading in light of the circumstances; |
6. |
engage in any manipulative practice with respect to any Client; or |
7. |
engage in any act, practice or course of conduct which operates or would operate as a fraud or deceit upon any Client. |
Further, Access Persons must, at all times, comply with applicable laws, including relevant federal and state securities laws and regulations and stock exchange rules.
III. |
Conflicts of Interest Policy |
Access Persons should seek to avoid any activity that might detract from or conflict with the interests of any Client or the Advisors. An actual or potential conflict of interest occurs when an Access Person is in a position to influence a decision that may result in a personal gain for the Access Person or a member of his or her Immediate Family as a result of the Advisors or the Trusts business dealings.
Access Persons must report any conflicts of interest or potential conflicts of interest promptly upon becoming aware of such to the CCO. The CCO will review details of any actual or potential conflicts of interest and (1) instruct Access Persons to avoid the identified activities; or (2) obtain reasonable assurance that necessary disclosures are made (if any) and appropriate controls instituted.
Although it is impossible to present a complete list of actions or interests that present or may present a conflict of interest, the following items are intended to provide general direction concerning the expectations and requirements with respect to an Access Persons conduct.
A. |
Personal Gain |
An Access Person must disqualify himself or herself from exerting influence in any business transaction where the Access Persons personal interests may compete with the best interests of any Client or the Advisors (or any of their affiliates) or where the Access Person may gain any benefit at any Clients or the Advisors (or their affiliates) injury or expense.
2
B. |
Company Records and Confidential Information |
Proprietary and/or confidential information about Clients, the Advisors, or their affiliates are valuable company assets. The Trusts and the Advisors take care to ensure that such information is maintained and handled in a manner that is safe, private and accessible only to authorized users.
Access Persons are obligated to protect the confidentiality of Clients, the Advisors, and their affiliates confidential information which includes investment analyses; nonpublic trading records; performance and identity of specific investments; the identity of current and prospective investors and Clients; internal financial and operating records, policies and procedures; marketing practices; and investor relations techniques and practices. Access Persons are also required to maintain the confidentiality of information regarding companies that the Trusts and the Advisors directly or indirectly controls. Proprietary and/or confidential information or materials of the Trusts or the Advisors or their affiliates are solely for the use of the Trusts or the Advisors or their affiliates, as applicable, and are not to be used for personal purposes.
When using proprietary and/or confidential information in their possession, Access Persons should ensure that such information is not available to any unauthorized persons, that they do not discuss it with any unauthorized persons, and that they take all reasonable precautions to ensure that access to the information continues to be restricted after use.
When accepting employment with the Advisors, Access Persons sign a confidentiality agreement in which they agree that any confidential and/or proprietary information imparted to, or learned by, them in connection with such employment will only be used in the performance of their duties to the Advisors or the Trusts and will be held in confidence and trust, using all reasonable precautions to ensure that the information is not disclosed to any unauthorized person or used in an unauthorized manner, either during or after employment with the Advisors.
Questions regarding the handling of Clients, the Advisors or their affiliates information should be brought to the CCO.
C. |
Outside Employment, Business Activities and Directorships |
Access Persons who are full-time employees of the Advisors are discouraged from undertaking additional or outside employment, including self-employment, business ventures and employment with other companies. Any such outside employment or venture must be reported by Access Persons via the Online Compliance Dashboard and pre-approved by the CCO in writing. Employees may serve as directors or trustees of governmental, commercial or not-for-profit organizations only with the prior written approval.
The COO will ensure that he or she provides a copy of any written authorization granted pursuant to this Section to the CCO or that he or she records such approval into the Online Compliance Dashboard.
No Investment Person may serve on the board of directors of a publicly-held company (other than the Trusts) without prior written authorization by the CCO, who will consider, among other things, whether such service will require the affected Investment Person be isolated, through information barriers or other procedures, from those making investment decisions related to the issuer on whose board the Investment Person sits.
3
D. |
Gifts and Benefits |
The following provisions on gifts and benefits apply to all Access Persons.
1. |
Accepting Gifts and Benefits |
On occasion, because of their position with the Trusts, Access Persons may be offered, or may receive without notice, gifts from clients, brokers, vendors, or other persons or entities. Access Persons must not accept extraordinary or extravagant gifts or benefits, and any such gifts or benefits must be declined or returned. Gifts of a nominal value (i.e., gifts whose value is no more than $100 a year) may be accepted. Access Persons must report all gifts received (regardless of value) in connection with their positions with the Advisors or the Trusts via the Online Compliance Dashboard.
If an Access Person receives any gift that is or may be prohibited under this Code, the Access Person must promptly inform Compliance via the Online Compliance Dashboard.
The Advisors may grant exceptions to this policy under certain limited circumstances. Access Persons should contact the CCO if they believe a particular situation warrants an exception.
Notwithstanding the foregoing, the Advisors, the Trusts, Access Persons and their affiliates shall not give or accept gifts in the form of cash, cash equivalents or negotiable instruments.
2. |
Solicitation of Gifts or Benefits |
Access Persons may not solicit gifts, benefits or gratuities.
3. |
Giving Gifts |
Access Persons may not give any gift with a value in excess of $100 per year to persons associated with securities or financial organizations, including exchanges, other member organizations, commodity firms, news media, or Clients. Access Persons must report all gifts given (regardless of value) in connection with their positions with the Advisors or the Trusts via the Online Compliance Dashboard.
4. |
Entertainment |
Business meals, entertainment (e.g., sporting events) and promotional items (e.g., pens or mugs) are not subject to the $100 limit on gifts and may be accepted if the entertainment or promotional items are appropriate and reasonable in frequency, value and type. In addition to being appropriate and reasonable in frequency, value and type, the person inviting the Access Persons to an event or providing the entertainment must also attend the event, meal or other entertainment. Questions with respect to receipt of promotional items or entertainment should be directed to the CCO.
E. |
Corporate Opportunities |
An Access Person shall not take personal advantage of any opportunity that the Access Person knew or should have known properly belonged to the Trusts or the Advisors. This includes, but is not limited to, acquiring Securities for ones own account (or in the account of an Access Persons Immediate Family) that would otherwise be acquired for a Fund, if the Access Person knows that by acquiring the security the Access Person is preventing the Fund from acquiring or selling the security or effect the price at which the security is acquired or sold.
4
F. |
Undue Influence |
Access Persons may not cause, or attempt to cause, any Fund to purchase, sell or hold any Security in a manner intended to create any personal benefit to the Access Person. If an Access Person or a member of his or her Immediate Family may benefit from an investment decision for a Fund which the Access Person is recommending or participating in, the Access Person must disclose to those persons with authority to make investment decisions (or, if the Access Person in question is a person with authority to make investment decisions, to the CCO) any Beneficial Interest that the Access Person (or a member of his or her Immediate Family) has in that Security or an Equivalent Security, or in the issuer thereof, where the decision could create a material benefit to the Access Person (or a member of his or her Immediate Family) or the appearance of impropriety. The person to whom the Access Person reports the interest, in consultation with the COO, must determine whether or not the Access Person will be restricted from making investment decisions in such instances and whether disclosure is necessary and if additional controls should be instituted.
IV. |
Personal Securities Transactions |
Access Persons and any member of their Immediate Family must conduct their personal account transactions in a manner so as to avoid any actual or potential conflict of interest or any abuse of their position of trust. The following personal account policies are designed to reduce the possibility of any conflict or appearance of impropriety. For ease of reference, Access Persons may refer to the Personal Securities Transactions Chart included as Appendix A.
A. |
Preclearance Exempt Transactions |
Access Persons may engage in the following Securities Transactions without first obtaining preclearance (Exempt Transactions), but are subject to the Reporting Requirements:
1. |
Any acquisition or disposition of Securities as the result of stock dividends, dividend reinvestments, stock splits, reverse stock splits, mergers, consolidations, spin-offs, or other similar corporate reorganizations or distributions generally applicable to all holders of the same class of Securities for which an Access Person or a member of his or her Immediate Family has Beneficial Ownership. |
2. |
Purchasing Securities under an Automatic Investment Plan, which means a program in which regular periodic purchases or withdrawals are made automatically in or from investment accounts according to a predetermined schedule and allocation. An Automatic Investment Plan includes a dividend reinvestment plan. Notwithstanding the foregoing, any proposed changes to an Automatic Investment Plan by an Access Person or a member of his or her Immediate Family must be precleared by Compliance through the Online Compliance Dashboard or using the form provided by Compliance. |
3. |
Acquiring Securities by exercising rights issued to the holders of a class of Securities pro rata, to the extent they are issued with respect to Securities for which an Access Person or a member of his or her Immediate Family has Beneficial Ownership. |
4. |
Purchasing or selling (redeeming) shares of the Direxion Funds (which specifically excludes 3X and 2X Leveraged or Inverse Leveraged ETFs and Funds and 1.25X and 1.35X Leveraged Funds, but includes Direxion 1.35X Leveraged ETFs and Relative Weight ETFs). |
5
5. |
Securities held in an account over which the Access Person (or members of his or her Immediate Family) has no direct or indirect influence or control. For example, Securities Transactions effected for an Access Person by a third party money manager who has sole discretionary trading authority and where the Access Person is neither consulted nor advised of the trade before it is executed. Documentation evidencing such arrangements must be furnished to the CCO. This includes robo advisors in which the employee has the option to pick the investment strategy employed but has no control over the investments chosen to meet that strategy ; |
B. |
Preclearance and Reporting Exempt Transactions |
Access Persons may engage in the following Securities Transactions without first obtaining preclearance and without being subject to the Reporting Requirements (also, Exempt Transactions):
1. |
Any open-end mutual funds registered in the U.S. that are not: a) Leveraged or Inverse Leveraged Funds; or b) the Direxion Funds (see Section IV.A); |
2. |
Money market instruments and bank certificates of deposits; |
3. |
Securities directly issued by the U.S. Government; |
4. |
Bankers acceptances; |
5. |
Commercial paper; |
6. |
High quality short-term debt instruments, including repurchase agreements; and |
7. |
Other Securities as from time to time may be designated in writing by the CCO on the grounds that the risk of abuse is minimal or nonexistent. |
C. |
Preclearance |
Access Persons or any member of their Immediate Family that desire to purchase or sell Securities that (1) are not Exempt Transactions, but (2) are Acceptable Instruments (as defined below), in accounts over which they have Beneficial Ownership must receive written preclearance from Compliance via the Online Compliance Dashboard. After an Access Person has formally requested preclearance, the Access Person will receive notification through the Online Compliance Dashboard whether the requested transaction has been cleared.
No Access Person shall have authority to authorize his or her own preclearance requests or preclearance requests related to his or her Immediate Family.
Acceptable Instruments include:
|
Stocks (long-only); |
|
bonds; |
|
closed-end funds; |
|
ETFs that are not Leveraged or Inverse Leveraged Funds; |
|
the Direxion 1.35X Leveraged ETFs, Direxion Non-leveraged ETFs and Funds, and Relative Weight ETFs; |
|
Other pooled investment vehicles or funds that are not specifically designed to be Leveraged or Inverse Leveraged Funds; |
|
Limited Offerings; and |
6
|
Cryptocurrencies. |
A request for preclearance may be declined if Compliance determines that the Access Person may potentially benefit from, or that the transaction is in conflict with or appears to be in conflict with, a Securities Transaction or position of the Trusts.
Preclearance of a trade grants the Access Person permission to trade and does not obligate the Access Person to trade. Preclearance of a trade is valid and in effect only for the day on which preclearance is given, provided, however, that a preclearance automatically expires upon the Access Person becoming aware of facts or circumstances that would prevent the proposed Securities Transaction from being precleared if such facts or circumstances were made known to Compliance. Accordingly, if an Access Person becomes aware of new or changed facts or circumstances that may give rise to a question as to whether preclearance could be obtained if Compliance was aware of such facts and circumstances the Access Person is required to so advise Compliance before proceeding with any such Securities Transaction.
Pre-clearance is not required for Discretionary accounts. These are accounts which are actively managed by an investment advisor who makes all investment decisions without input of the Access Person, or accounts with robo-advisors who offer defined portfolios choices in which the employee has no ability to choose investments other than choosing the portfolio strategy.
D. |
Restrictions |
The following personal trading transactions by an Access Person or a member of his or her Immediate Family are prohibited:
1. |
Any transaction in a Security in anticipation or with knowledge of an order from or on behalf of a Fund (i.e., front running). This prohibition does not include rebalancing transactions within the Funds. |
2. |
Any transaction of a Security included on the Blacklist. |
3. |
Any transaction in options, futures, options on futures, commodities or Leveraged or Inverse Leveraged Funds, except the Direxion 1.35X Leveraged ETFs, and Relative Weight ETFs. |
4. |
Any transaction in a Security that would result in an Access Persons purchasing and selling, or selling and purchasing the same or an Equivalent Security within 30 days, is prohibited (a short-swing trade). In other words, Access Persons are required to hold Securities for a minimum of 30 days. The CCO may, for good cause shown, permit a short-swing trade, but shall record the reasons and grant of permission in an Advisors compliance files. |
5. |
Any transaction in an Initial Public Offering. |
6. |
Any short sale transaction or transaction where the Access Person or a member of his or her Immediate Family is selling or promising to deliver Securities for which he, she or they (as the case may be) does not have present Beneficial Ownership. |
E. |
Prior Holdings |
The CCO may permit transactions in Securities that are not Acceptable Instruments in instances when an Access Person or a member of his or her Immediate Family has holdings acquired before becoming an Access Person, provided that such Securities are not on the Blacklist by virtue of the Advisors having material nonpublic information with respect to such Securities or Equivalent Security. In such instances,
7
the Access Person must request and obtain preclearance prior to engaging in such transactions from Compliance who will make a decision as to whether to preclear the request based on the parameters set forth in the immediately preceding Section.
V. |
Reporting |
Access Persons must submit periodic reports about their Securities holdings, Securities Transactions and accounts (including accounts over which they have Beneficial Ownership and accounts of their Immediate Family) to Compliance, via the Online Compliance Dashboard. The reports are intended to identify conflicts of interest that could arise and to promote compliance with this Code.
A. |
Reporting Requirements for all Access Persons |
1. |
Initial Holdings and Accounts Report |
Any person who becomes an Access Person must submit, within 10 days of becoming an Access Person, an initial holdings and accounts report to Compliance listing all accounts and Securities in which the Access Person or their Immediate Family has a Beneficial Interest (unless excepted by Section IV.B. above) based on information that is current as of a date not more than 45 days prior to the date such person became an Access Person. Such reports shall be submitted (preferably) via the Online Compliance Dashboard or (alternatively) using the form provided by Compliance. An initial holdings and accounts report must contain:
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The name or title and type of Security; and, as applicable, the exchange ticker symbol or CUSIP, the number of shares or the principal amount of each Security for which the Access Person or a member of his or her Immediate Family has Beneficial Ownership. Access Persons may provide this information by referring to attached copies of broker transaction confirmations or account statements that contain the information; |
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The name and address of any broker, dealer, bank, or other institution that maintained any account holding of any Securities for which Access Person or a member of his or her Immediate Family have Beneficial Ownership, and the account numbers and names of the persons for whom the accounts are held. Access Persons may provide this information by referring to attached copies of broker transaction confirmations or account statements that contain the information; |
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Upon request, an executed statement and a letter or other evidence pursuant to which the Access Person has instructed each broker, dealer, bank, or other institution to provide duplicate confirmations of all Securities Transactions and periodic account statements to the CCO; and |
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The date the report was submitted. |
2. |
Quarterly Reporting Requirements |
Unless excepted by Section IV.B. above, Access Persons and their Immediate Family must authorize access to their personal trading account transactions and holdings information via the Online Compliance Dashboard. If an Access Person or a member of his or her Immediate Family are unable to arrange for electronic transmission of personal trading account information, the Access Person must arrange for Compliance to receive duplicate copies of trade confirmations and periodic statements for each brokerage account in which the Access Person or a member of his or her Immediate Family has
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a Beneficial Interest (unless excepted by Section IV.B. above). All copies required by this Section must be received by Compliance no later than 30 days after the end of each calendar quarter. Confirmations and/or statements must contain the following information:
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The date of the transaction; |
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The name or title and as applicable, the exchange ticker symbol, CUSIP, interest rate and maturity date; |
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The number of shares or principal amount; |
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The nature of the transaction (i.e., purchase or sale); |
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The price of the Security; and |
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The name of the broker, dealer, bank, or other institution with or through which the trade was effected. |
If an Access Person is not able to arrange for electronic delivery of personal trading account information or to provide duplicate confirmations and periodic statements to be sent that contain the information required above, the Access Person must submit a quarterly transaction report within 30 days after the end of each calendar quarter to the CCO via the Online Compliance Dashboard. The information in the quarterly transaction report must contain the details required in confirmations or statements (as set forth immediately above), be current as of a date no more than 45 days before the report is submitted, and indicate the date on which the report is submitted.
Access Persons are excused from submitting Quarterly Transaction Reports due to a lack of information to report, but must nevertheless provide a statement that (a) all pertinent information regarding their personal trading for the past calendar quarter has been provided to the Advisors in the form of trade confirmations and account statements; or (b) they had no personal trades to report during the last calendar quarter.
Access Persons with discretionary accounts must provide a list of holdings on a quarterly basis.
3. |
New Accounts |
Every new Access Person (and his or her Immediate Family) who has a personal trading account must submit an report through the Online Compliance Dashboard to Compliance within 10 days of the Access Persons employment start date. For all existing Access Person (or a member of his or her Immediate Family) each new account must be pre-cleared prior to the accounts opening.
4. |
Annual Holdings and Accounts Report |
Unless excepted pursuant to Section IV.B. above, Access Persons must submit an annual holdings and accounts report via the Online Compliance Dashboard listing all securities accounts and Securities in which the Access Person or a member of his or her Immediate Family has a Beneficial Interest. The information in the annual holdings report must be current as of a date no more than 45 days before the report is submitted. The completed report shall be submitted to the CCO promptly following the end of the calendar year, but in any event no later than February 14 of each year. The annual holdings report must contain:
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The name or title and type of Security, and as applicable, the ticker symbol or CUSIP, the number or shares or principal amount of each Security for which the Access Person or a member of his or her Immediate Family has Beneficial Ownership; |
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The name and address of any broker, dealer, bank, or other institution that maintained any account holding any Securities for which the Access Person or a member of his or her Immediate Family had Beneficial Ownership, as well as the account numbers and names of the persons for whom the accounts are held and the date when each account was established; and |
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The date that the report is submitted. |
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The above bullets are applicable to all discretionary and robo-advisor accounts. Account holders must provide a list of holdings in their discretionary accounts on an annual basis or as requested from time-to-time by compliance. |
B. |
Disclaimers and Availability of Reports |
1. |
Disclaimers |
Any report of a Securities Transaction for the benefit of a person other than the individual in whose account the transaction is placed may contain a statement that the report should not be construed as an admission by the person making the report that he or she has any direct or indirect Beneficial Ownership in the Security to which the report relates.
2. |
Review |
Compliance will review all reports and personal Securities holdings and Securities Transactions submitted by Access Persons. No Access Person shall be responsible for reviewing and reconciling his or her own personal account trading activity
Any findings of material violations of this Code will be reported by the CCO to the board of trustees of the Trust (the Board) at its next regularly scheduled meeting. The term material as used in this Code, means information about which the Board reasonably needs to know in order to oversee the Trusts compliance with the federal securities laws, and that involves, without limitation, violations of the federal securities laws.
VI. |
Compliance with this Code |
A. |
CCO Review |
1. |
Investigating Violations of the Code |
The CCO or her delegate is responsible for investigating any suspected violation of the Code and shall report the results of any investigation to an Advisors Risk and Compliance Committee (the Committee). Any material violations of the Code will be reported to the Board at or prior to the next regularly scheduled meeting of the Board.
2. |
Annual Reports |
On at least an annual basis, the CCO, on behalf of the Advisors, will provide a written report to the Board that:
a. |
Describes any issues arising under the Code since the last report to the Board, including, but not limited to, information about material violations of the Code and sanctions imposed in response to the material violations; and |
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b. |
Certifies that the Advisors have adopted procedures reasonably necessary to prevent Access Persons from violating the Code. |
B. |
Remedies |
1. |
Sanctions |
If the CCO determines that an Access Person has committed a violation of the Code following a report to Compliance, the Committee may impose sanctions and take other actions as they deem necessary and/or appropriate, including issuing a letter of caution or warning, suspending personal trading rights, suspending employment (with or without compensation), imposing a fine, civil referral to the Securities and Exchange Commission, criminal referral, and terminating (for cause) employment. The Committee may also require the Access Person to reverse any trade(s) made in violation of the Code and forfeit any profit or absorb any loss derived therefrom. The amount of profit shall be calculated by the Committee and shall be forwarded to an Advisor who will in turn forward the funds to a charitable organization selected by the Committee from the Advisors list of approved charities.
Any Access Person to which a violation of the Code relates must recuse himself or herself from any discussion or decision with respect to the handling and/or imposition of sanctions regarding such violation.
2. |
Sole Authority |
The Committee have sole authority, subject to the Board review, to determine the remedy for any violation of the Code, including appropriate disposition of any monies forfeited pursuant to the Code. Failure to promptly abide by a directive to reverse a trade or forfeit profits may result in further sanctions.
3. |
Review |
Whenever the Committee determine that an Access Person has committed a violation of this Code that merits remedial action, the CCO will report no less frequently than quarterly to the Board, information relating to the investigation of the violation, including any sanctions imposed. The Board may modify such sanctions as it deems appropriate. The Board shall have access to all information considered by the Committee, in relation to the incident. The Committee and COO may determine to delay imposing sanctions pending review by the Board.
C. |
Exceptions to the Code |
The CCO may grant exceptions to the requirements of the Code on a case-by-case basis if granting an exception is consistent with applicable law and the CCO finds that the proposed conduct present negligible opportunity for abuse. All such exceptions must be in writing and must be reported as soon as practicable to the Board at its next regularly scheduled meeting after the exception is granted.
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D. |
Compliance Certification |
All Access Persons and newly-hired Access Persons shall certify that they have received, read and understood the Code by providing a certification of compliance with the Code via the Online Compliance Dashboard. In addition, on an annual basis, all Access Persons will be required to re-certify (via the Online Compliance Dashboard) that they have read and understood the Code, complied with the requirements of the Code, and reported all Securities Transactions to the extent required by the Code.
E. |
Duty to Report Violations |
All Access Persons are required to promptly report, to the CCO, information by which they believe or reasonably suspect that a violation of this Code has been or is likely to be committed. This includes an Access Person reporting his or her own violations or potential violations of this Code. Such reports may be made orally or in writing.
Any such reports will be treated confidentially (to the extent permitted by applicable law) and investigated promptly and appropriately. Further, retaliation in any form by an Access Person against another Access Person for reporting a potential violation in good faith is strictly prohibited and will, at a minimum, be deemed a violation of this Code.
Access Persons are encouraged to seek advice from the CCO with respect to any action or transaction which may violate this Code and should refrain from any action or transaction which might lead to the appearance of impropriety or a violation of the Code.
VII. |
Definitions |
1. |
Beneficial Interest means the opportunity, directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise, to profit, or share in any profit derived from, a transaction in the subject Securities. An Access Person is deemed to have a Beneficial Interest in Securities owned by members of his or her Immediate Family. Common examples of Beneficial Interest include joint accounts, spousal accounts, UTMA accounts, partnerships, trusts and controlling interests in corporations. Questions as to whether an Access Person has a Beneficial Interest in a Security will be resolved in accordance with, and this definition shall be subject to, the definition of beneficial owner found in Rules 16a-1(a)(2) and (5) promulgated under the Securities Exchange Act of 1934, as amended. |
2. |
Blacklist means the list of issuers, maintained and updated from time to time within the Online Compliance Dashboard, as to which one or more individuals at the Advisors, including Access Persons may have material information which has not yet been publicly disclosed. This list also includes Leveraged and Inverse Leveraged Funds. |
3. |
Compliance means the current members of the Advisors compliance department, including the CCO. |
4. |
Direxion Funds means one or more of the series of the Direxion Funds, Direxion Insurance Trust or Direxion Shares ETF Trust, for which the Advisors serve as an investment adviser and specifically excludes 3X and 2X Leveraged or Inverse Leveraged ETFs and Funds and the 1.25X and 1.35X Leveraged Funds. |
5. |
Equivalent Security means any Security issued by the same entity as the issuer of a subject Security, including options, rights, stock appreciation rights, warrants, preferred stock, restricted |
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stock, phantom stock, bonds, and other obligations of that company or Security otherwise convertible into that Security. Options on Securities are included even if, technically, they are issued by the Options Clearing Corporation or a similar entity. |
6. |
Immediate Family means any of the following persons of an Access Person who reside in the same household as the Access Person: child, stepchild, grandchild, spouse, sibling, parent, stepparent, grandparent, mother-in-law, father-in-law, daughter-in-law, son-in-law, sister-in-law, and brother-in-law. Immediate Family includes adoptive relationships and any other relationship (whether or not recognized by law) which the CCO determines could lead to the possible conflicts of interest, diversions of corporate opportunity, or appearances of impropriety which this Code is intended to prevent. |
7. |
Independent Trustee means a trustee of a Trust who is not an interested person as that term is defined in Section 2(a)(19) of the 1940 Act. |
8. |
Initial Public Offering is an offering of securities registered under the Securities Act of 1933, as amended by an issuer who immediately before the registration of such securities was not subject to the reporting requirements of Sections 13 or 15(d) of the Securities Exchange Act of 1934, as amended. |
9. |
Investment Person mean (1) employees of the Advisors or the Trusts (or of any company in a control relationship to such companies) who, in connection with his or her regular functions or duties, makes or participates in making recommendations regarding the purchase or sale of a Security, or (2) any natural person who controls an Advisor or the Trusts and who obtains information concerning recommendations made to the Trust regarding the purchase and sale of Securities by the Trust. References to Investment Persons include each Advisors portfolio managers. |
10. |
Leveraged and Inverse Leveraged Funds means, generally, any investment fund or any exchange-traded fund that utilizes leverage or inverse leverage strategies which resets on a daily or monthly basis, and specifically includes any of the portfolios managed by the Advisors that utilize leverage or inverse leverage strategies, as identified from time to time by Compliance on the Blacklist within the Online Compliance Dashboard. This prohibition does not include investments in the portfolios that are series of the Direxion Shares ETF Trust that are 1.35X Leveraged ETFs and Relative Weight ETFs. |
11. |
Limited Offering means an offering that is exempt from registration under the Securities Act of 1933, as amended pursuant to Section 4(2) or Section 4(5) or pursuant to Rule 504, 505 or 506 of Regulation D under the Act. |
12. |
Online Compliance Dashboard means any online compliance platform or software program used by Compliance to facilitate monitoring of each Advisors compliance program, including reporting required under this Code. |
13. |
Security includes stock, exchange traded funds, notes, bonds, debentures, preferred or other senior securities and other evidences of indebtedness (including loan participations and assignments), limited partnership interests, investment contracts, cryptocurrencies, and all derivative instruments of the foregoing, such as options and warrants. Though the definition of security under applicable law generally does not include futures, options on futures, or commodities, such instruments are nevertheless included within the definition of Securities for purposes of this Code. |
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14. |
Securities Transaction means a purchase or sale of Securities in which an Access Person or a member of his or her Immediate Family has or acquires a Beneficial Interest. |
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Appendix A
Instrument (Type of Security) or Type of Transaction |
Eligibility Are you able to trade? |
Preclearance Do you need to preclear the trade? (preclearance is only valid on the day given) |
Reporting Requirements Do you need to report these transactions? |
Holding Period Is a 30 day holding period required? |
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Funds | ||||||||
Open-end mutual funds that are not: (a) Leveraged or Inverse Leveraged Funds but including Hilton Tactical Income Fund and Direxion Indexed Commodity & Income Strategy Fund | Yes | No | No | No | ||||
Direxion Funds as defined in Section VII (excluding 2X and 3X Leveraged or Inverse Leveraged Funds or ETFs and 1.25X or 1.35X Leveraged Funds) | Yes | Yes | Yes | Yes | ||||
Leveraged or Inverse Leveraged Funds | No | n/a | n/a | n/a | ||||
Exchange-traded funds that are not Leveraged or Inverse Leveraged Funds | Yes | Yes | Yes | Yes | ||||
Closed-end funds | Yes | Yes | Yes | Yes | ||||
Other funds or pooled investment vehicles | Yes | Yes | Yes | Yes | ||||
Individual Investment Instruments | ||||||||
Stocks Long | Yes | Yes | Yes | Yes | ||||
Short Sales (of any investment instrument) | No | n/a | n/a | n/a | ||||
Bonds | Yes | Yes | Yes | Yes | ||||
Futures | No | n/a | n/a | n/a | ||||
Options | No | n/a | n/a | n/a | ||||
Commodities | No | n/a | n/a | n/a | ||||
Initial Public Offerings | No | n/a | n/a | n/a | ||||
Limited offerings (including private companies and private funds) | Yes | Yes | Yes | Yes | ||||
Money market instruments and bank certificates of deposit | Yes | No | No | No | ||||
Securities directly issued by the U.S. government | Yes | No | No | Yes | ||||
Municipal Securities | Yes | No | No | Yes | ||||
Bankers acceptances | Yes | No | No | No | ||||
High quality short-term debt instruments, including repurchase agreements | Yes | No | No | No | ||||
Commercial paper | Yes | No | No | No |
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Instrument (Type of Security) or Type of Transaction |
Eligibility Are you able to trade? |
Preclearance Do you need to preclear the trade? (preclearance is only valid on the day given) |
Reporting Requirements Do you need to report these transactions? |
Holding Period Is a 30 day holding period required? |
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Securities held in an account with no direct or indirect influence or control | Yes | No | No | No | ||||
Corporate reorganizations or distributions applicable to all holders of the same class of Securities, including stock dividends, dividend reinvestments, stock splits, reverse stock splits, mergers, consolidations and spin-offs | Yes | No | Yes, if the type of instrument is required to be reported under the Code | No | ||||
Automatic Investment Plans | Yes | No | No | n/a | ||||
Changes to Automatic Investment Plans | Yes | Yes, changes require preclearance | No, but changes must be precleared | n/a | ||||
Acquiring securities issued to the holders of a class of Securities pro rata | Yes | No | Yes, if the type of instrument is required to be reported | No | ||||
Cryptocurrencies (Bitcoin, Litecoin, etc) | Yes | Yes | Yes | Yes |
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APPENDIX B
Independent Trustees Code of Ethics
Effective: March 1, 2015
I. |
Introduction |
This Independent Trustees Code of Ethics (Code) has been adopted by Direxion Funds, Direxion Insurance Trust, and Direxion Shares ETF Trust (together, the Trusts, each a Fund) in compliance with Rule 17j-1 under the Investment Company Act of 1940, as amended (the 1940 Act). Unless otherwise defined, terms that are capitalized in this Code have the meanings set forth in the Code of Ethics and Section VII thereof. This Code applies to all Independent Trustees of the Trusts.
This Code is based on the principle that Independent Trustees have a duty to place the interests of the Trusts ahead of their own interests. Independent Trustees must act with integrity and good faith at all times, but particularly when their personal interests may conflict with the interests of the Trusts.
II. |
Standards of Conduct |
Independent Trustees must, in connection with their engagement with the Trusts, comply with applicable laws, including relevant federal and state securities laws, regulations and rules and stock exchange rules.
III. |
Conflicts of Interest |
Independent Trustees should seek to avoid any activity that might detract from, or conflict with, any interest of the Trusts. An actual or potential conflict of interest occurs when an Independent Trustee is in a position to influence a decision that may result in a personal gain for the Independent Trustee or a member of his or her Immediate Family as a result of the Trusts business dealings.
IV. |
Personal Securities Transactions |
Independent Trustees and members of their Immediate Family must conduct their personal account transactions in a manner so as to avoid any actual or potential conflict of interest or any abuse of their position of trust. The following personal account policies are designed to reduce the possibility of any conflict or appearance of impropriety.
A. |
Personal Securities Transactions |
If, in the ordinary course of fulfilling his or her official duties as a trustee, an Independent Trustee knew or should have known that during the 15-day period immediately before or after his or her transaction in a Reportable Security, the same Reportable Security was purchased or sold, or was being considered for purchase or sale by the Trust, such Independent Trustee is required to make a quarterly transaction and account report, as described in Section V. below. The foregoing requirement does not include rebalancing transactions by the Funds even if the Trustee knew or should have known that such transactions may transpire.
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B. |
Exception for Certain Accounts |
Notwithstanding the foregoing in subsection A above, Independent Trustees do not need to make a report with respect to transactions effected for, or Reportable Securities held in, any account over which the Independent Trustee or his or her Immediate Family have no direct or indirect influence or control (such as a third-party managed account, provided that neither the Independent Trustee nor his or her Immediate Family have authority to specify trades).
V. |
Reporting |
An Independent Trustee is required to report transactions in Reportable Securities only if, in the ordinary course of fulfilling his or her official duties as a trustee, the Independent Trustee knew or should have known that during the 15-day period immediately before or after his or her transaction in a Reportable Security, the same Reportable Security was purchased or sold, or was being considered for purchase or sale by the Trust (as described in Section IV.A. above). Such transactions within accounts over which the Independent Trustee has Beneficial Ownership, including accounts of members of his or her Immediate Family, should be reported on a quarterly basis as requested by Compliance.
VI. |
Oversight |
Compliance will review all reports and personal Securities Transactions submitted by Independent Trustees.
Any findings of material violations of this Code will be reported by the CCO to the Board at its next regularly scheduled meeting. The term material as used in this Code, means information about which the Board reasonably needs to know in order to oversee the Trusts compliance with the federal securities laws, and that involves, without limitation, violations of the federal securities laws.
A. |
Investigating Violations of the Code |
The CCO or his or her delegate is responsible for investigating any suspected violation of the Code. Any material violations of the Code, as well as the results of any investigation, will be reported by the CCO to the Board at or prior to the next regularly scheduled meeting of the Board.
B. |
Annual Reports |
On at least an annual basis, the CCO will provide a written report to the Board that:
1. |
Describes any issues arising under the Code since the last report to the Board, including, but not limited to, information about material violations of the Code; and |
2. |
Certifies that the Trusts have adopted procedures reasonably necessary to prevent Independent Trustees from violating the Code. |
C. |
Compliance Certification |
All Independent Trustees and newly-engaged Independent Trustees shall certify that they have received, read and understood the Code by providing a certification of compliance with the Code. In
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addition, on an annual basis, all Independent Trustees will be required to re-certify that they have read and understood the Code, complied with the requirements of the Code, and reported all Securities Transactions to the extent required by the Code.
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