Emerging Global To Begin Trading The “Emerging Global Shares INDXX China Infrastructure Index Fund” (CHXX) Tomorrow February 17th
Emerging Global is set to begin trading the “Emerging Global Shares INDXX China Infrastructure Index Fund” (CHXX) tomorrow. The Fund will seek investment results that generally correspond (before fees and expenses) to the price and yield performance of the INDXX China Mid Cap Index (the “Underlying Index”).
Principal Investment Strategies
The Fund seeks to achieve its investment objective by attempting to replicate the portfolio of the Underlying Index through investments in equity securities, including shares traded on local exchanges, American Depositary Receipts (“ADRs”) and Global Depositary Receipts (“GDRs”). The Underlying Index is a free-float market capitalization weighted stock market index comprised of a representative sample of 30 emerging markets companies that INDXX, LLC determines to be the representative of mid-market capitalization companies domiciled in China. Under normal circumstances, the Fund will invest at least 80% of its net assets in securities of Chinese mid cap companies included in the Underlying Index and generally expects to be substantially invested at such times, with at least 95% of its net assets invested in those securities. The Fund defines Chinese mid cap companies as companies that are included in the Underlying Index at the time of purchase and generally includes
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companies that are domiciled in China that trade on the exchanges of Hong Kong and the U.S. and have a market capitalization that is at least $200 million, but is lower than the 30th highest publicly traded company in China. The Fund will provide shareholders with at least 60 days’ notice prior to any changes in this policy.
From time to time, the Fund will purchase or sell certain of its portfolio securities to reflect changes to the constituent securities of the Underlying Index and to satisfy asset diversification requirements for qualification as a “regulated investment company” for purposes of the Internal Revenue Code. The Fund will also rebalance its portfolio securities promptly following the annual rebalancing of the Underlying Index. In recognition of longer settlement periods for emerging market securities, the Fund may at times purchase or sell portfolio securities in advance of anticipated adjustments to the weighting or composition of the constituent securities of the Underlying Index. The Fund does not seek temporary defensive positions when equity markets decline or appear to be overvalued.
The Fund’s intention is to replicate the constituent securities of the Underlying Index as closely as possible using ADRs, GDRs or ordinary local shares. In certain circumstances, when it may not be possible or practicable to fully implement a replication strategy, the Fund may utilize a “representative sampling” strategy whereby the Fund would hold a significant number of the component securities of the Underlying Index, but may not track the index with the same degree of accuracy as would an investment vehicle replicating the entire index. When securities are deleted from the Underlying Index, the Fund will typically remove these securities from the Fund’s portfolio. However, the Fund may, in EGA’s discretion, remain invested in securities that were deleted from the Underlying Index until the next rebalancing of the Fund.
Fees and Expenses
The following table describes the fees and expenses you may pay if you buy and hold shares of the Fund (“Shares”). You may also incur customary brokerage charges when buying or selling Fund Shares.
| Annual Fund Operating Expenses (expenses deducted from Fund assets) |
|
| Management Fees | 0.95% |
| Distribution and/or Service (12b-l) Fees | 0.00% |
| Other Expenses (1) | 0.57% |
|
|
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| Total Annual Fund Operating Expenses | 1.52% |
| Less Management Fee Waiver/Expense Reimbursement (2) | 0.67% |
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|
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| Total Annual Fund Operating Expenses (3) | 0.85% |
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