FocusShares, LLC (“Advisor”), a registered investment adviser, announced today that the Board of Trustees of the FocusShares Trust (“Trust”), in consultation with the Advisor, determined to discontinue and liquidate the FocusShares family of exchange traded funds (“Funds”) as of August 30, 2012.
The 15 Funds had approximately $100 million in aggregate assets as of July 31, 2012. The Funds were launched in March 2011 and are designed to track broad equity market and sector-specific Morningstar benchmark indexes.
The Board considered current market conditions, the inability of the Funds to attract significant market interest since their inception, and their future viability as well as prospects for growth in the Funds’ assets in the foreseeable future. The Board determined that it was advisable and in the best interests of the Funds and their shareholders to liquidate the Funds, which are listed for trading on NYSE Arca.
Friday, August 17, 2012, will be the last day of trading for the shares of the Funds on the NYSE Arca. In addition, August 17, 2012 will be the last day on which creation unit aggregations of each Fund’s shares may be purchased or redeemed. The NYSE Arca will suspend trading in the shares of the Funds before the open of trading on August 20, 2012. The Funds will be closed to new investment beginning August 20, 2012.
Shareholders may sell their holdings on the NYSE Arca up through August 17, 2012, incurring any applicable transaction fees from their broker-dealer. From August 20, 2012 through August 30, 2012, shareholders of each Fund may be able to sell their shares off the exchange to certain broker-dealers, but there can be no assurance that there will be a market for the Funds. All shareholders remaining on August 30, 2012 will receive cash equal to the amount of the net asset value of their Fund shares as of August 30, 2012, which will include any capital gains and dividends, into the cash portion of their brokerage accounts on or about August 31, 2012.
Shareholders receiving the final liquidating cash distribution will not incur transaction fees in connection with this distribution or the cancellation of their Fund shares. Moreover, shareholders will not bear any expenses associated with the liquidation of the Funds other than bearing indirectly the portfolio transaction costs incurred in liquidating the Funds’ assets in advance of the Funds’ closure. On August 20, 2012, the Funds will commence the process of liquidating their assets and, consequently, may be unable to pursue their investment objectives.
The affected Funds are:
|Focus Morningstar US Market Index ETF||FMU|
|Focus Morningstar Large Cap Index ETF||FLG|
|Focus Morningstar Mid Cap Index ETF||FMM|
|Focus Morningstar Small Cap Index ETF||FOS|
|Focus Morningstar Basic Materials Index ETF||FBM|
|Focus Morningstar Communication Services Index ETF||FCQ|
|Focus Morningstar Consumer Cyclical Index ETF||FCL|
|Focus Morningstar Consumer Defensive Index ETF||FCD|
|Focus Morningstar Energy Index ETF||FEG|
|Focus Morningstar Financial Services Index ETF||FFL|
|Focus Morningstar Health Care Index ETF||FHC|
|Focus Morningstar Industrials Index ETF||FIL|
|Focus Morningstar Real Estate Index ETF||FRL|
|Focus Morningstar Technology Index ETF||FTQ|
|Focus Morningstar Utilities Index ETF||FUI|
For additional information about the liquidation, shareholders of the Funds may call their brokers or FocusShares at (314) 205-2952 or go to the FocusShares website:http://www.FocusShares.com.
Before investing in any FocusShares Fund, you should carefully consider the applicable Fund’s investments objectives, risks, charges and expenses. This and other information is in the applicable Fund’s prospectus, a copy of which may be obtained by visiting the FocusShares website at www.focusshares.com. Please read the Fund prospectus carefully before you invest.
An investment in any FocusShares Fund is subject to risk, including the possible loss of principal amount invested. Sector funds tend to be riskier and more volatile than broad market funds because they are less diversified. Investments in mid- and small-capitalization companies may be more volatile than investments in larger companies. Concentrated fund investment will subject the Fund to a greater risk of loss as a result of adverse economic, business or other developments than if its investments were diversified across different industry sectors. Each sector fund is subject to its own specific risk factors. See the prospectus for specific risks regarding each sector.
Foreside Fund Services, LLC is the Distributor for FocusShares.
About FocusShares, LLC
FocusShares, LLC, is a registered investment advisor, exchange-traded funds sponsor and wholly-owned subsidiary of Scottrade Financial Services, Inc. In March 2011, FocusShares launched the 15 Focus™ Morningstar Funds that are based on Morningstar® US Market, Large Cap, Mid Cap and Small Cap broad market indexes and 11 sector indexes, including Basic Materials, Communication Services, Consumer Cyclical, Consumer Defensive, Energy, Financial Services, Health Care, Industrials, Real Estate, Technology and Utilities. FocusShares, LLC is based in St. Louis, M.O. For more information, visit us at http://www.FocusShares.com.
FocusShares®, the FocusShares® logo and Focus™ are the registered and unregistered trademarks of FocusShares, LLC. All other marks are the property of their respective owners.
Morningstar® is a service mark of Morningstar, Inc. and has been licensed for use for certain purposes by FocusShares, LLC. The Focus™ Morningstar Funds are not sponsored, endorsed, sold or promoted by Morningstar, and Morningstar makes no representation regarding the advisability of investing in Focus™ Morningstar Funds.
Jack Naudi, 314-965-1555, x 1276