of its total assets in stocks and the shares of exchange-traded open-end registered investment companies (“ETFs”) selected by the Fund Sub-Adviser, Laffer, which invest in domestic or foreign stocks. The Fund may invest in ETFs beyond the limits set forth in Section 12(d)(1)(A) of the 1940 Act, pursuant to exemptive relief granted to such ETFs. The Fund intends to invest in securities that, in Laffer’s opinion, stand to benefit from improvements in the value of a country’s equity market relative to other countries. Laffer’s process aims to identify the most relatively undervalued equity markets around the world. Laffer uses proprietary multi-factor modeling which combines quantitative analysis of a country’s actual exchange rates, fiscal policies, and global economic environment together with qualitative analysis of a country’s expected exchange rates, fiscal polices, and global economic environment. The markets identified by these analyses as best bets are then analyzed for special situations such as trade disputes, military conflicts, political instability and supply/demand interruptions, resulting in the final country ranking. Laffer will then invest in stocks located in, and ETFs focused in, the top 12-16 countries under Laffer’s methodology. Laffer will periodically rebalance the Fund’s portfolio.
Claymore Active National Municipal ETF
The Claymore Active National Municipal ETF’s investment objective is to seek current income exempt from regular federal income tax. The Fund’s secondary objective is the enhancement of portfolio value in an effort to outperform the Fund’s performance benchmark, the Barclays Capital 7-Year Municipal Bond Index. The Fund is a Domestic Fund and a Fixed Income Fund, which invests substantially all of its assets in tax-exempt and AMT-free municipal obligations rated within the four highest grades (BBB/Baa or better). The Fund may invest up to 20% of its assets in unrated municipal obligations considered to be of equivalent quality. To be included in the Fund, bonds must be rated Baa3/BBB- or higher by at least two of the following ratings agencies: Moody’s Investors Service, Inc., Standard & Poor’s and Fitch Inc. If only two of the three agencies rate the security, the lower rating is used to determine eligibility. If only one of the three agencies rates a security, the rating must
be at least Baa3/BBB-. Potential holdings must have an outstanding par value of at least $7 million and be issued as part of a transaction of at least $75 million. The bonds must be fixed rate, have a dated-date within the last ten years and have a nominal maturity of 1-30 years. The following types of bonds are excluded from consideration: bonds subject to the alternative minimum tax, remarketed issues, taxable municipal bonds, floating rate bonds, and derivatives. Bonds that may be included are generally considered to be one of four types of bonds: state and local general obligation bonds, revenue bonds, insured bonds, and pre-refunded bonds.
Claymore/S&P Commodity Trends Strategy ETF
The Claymore/S&P Commodity Trends Strategy ETF’s investment objective is to seek results that match the performance, before fees and expenses, of a benchmark which the Adviser believes is appropriate for measuring trends in the commodities market. The Fund will seek to achieve its investment objective by investing in a combination of commodity-linked derivatives and fixed income securities directly and/or indirectly through its wholly-owned subsidiary (the “Subsidiary”). The Fund is a Domestic Fund and a Fixed Income Fund, though the Fund will also invest in commodity-linked derivatives and may also invest in certain equity securities as set forth below. The Fund typically will invest in commodity-linked derivatives principally through the Subsidiary. These commodity-linked derivatives include commodity futures, commodity and commodity index options, options on commodity futures, and commodity and commodity index swap contracts. The Fund may also invest in commodity-linked notes. The commodity-linked derivatives will be positioned either long or short (except for the energy sector contracts, which cannot have a short position) based on their prices relative to their weighted average price over a recent period, or “moving averages.” The Fund also may invest directly in ETFs and other investment companies that provide exposure to managed commodities and equity
Full filing can be found: HERE