[Federal Register: August 10, 2009 (Volume 74, Number 152)]
[Notices]
[Page 39957]
[DOCID:fr10au09-32]

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ENVIRONMENTAL PROTECTION AGENCY

[Docket No. EPA-R02-OAR-2009-0508; FRL-8942-8]

Adequacy Status of the Municipality of Guaynabo, PR submitted
PM10 Limited Maintenance Plan for Transportation Conformity
Purposes

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice of Adequacy.

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SUMMARY: In this notice, EPA is notifying the public that we have found
that the Limited Maintenance Plan for PM10 in the
Municipality of Guaynabo, Puerto Rico is adequate for transportation
conformity purposes.

DATES: This finding is effective August 25, 2009.

FOR FURTHER INFORMATION CONTACT: Marina Cubias-Castro, Air Programs
Branch, Environmental Protection Agency--Region 2, 290 Broadway, 25th
floor, New York, NY 10007<EMAIL_ADDRESS>212-637-3713.
    The finding and the response to comments are available at EPA's
conformity Web site: http://www.epa.gov/otaq/stateresources/transconf/
adequacy.htm.

SUPPLEMENTARY INFORMATION:

Background

    Today's notice is simply an announcement of a finding that we have
already made. EPA Region 2 sent a letter to the Puerto Rico
Environmental Quality Board on June 23, 2009 stating that the
Municipality of Guaynabo submitted PM10 Limited Maintenance
Plan, is adequate.
    On August 9, 2001, EPA issued guidance on streamlined maintenance
plan provisions for certain moderate PM10 nonattainment
areas seeking redesignation to attainment (Memo from Lydia Wegman,
Director, Air Quality Standards and Strategies Division, entitled
``Limited Maintenance Plan Option for Moderate PM10
Nonattainment Areas''). The LMP Option memo contains a statistical
demonstration that areas meeting certain air quality criteria will,
with a high degree of probability, maintain the standard 10 years into
the future. Since the Municipality of Guaynabo has been attaining the
PM10 NAAQS for at least 5 years, and has a low risk of
future exceedances, the limited maintenance plan policy allows both
Puerto Rico and EPA to redesignate this area, which is at a low risk of
PM10 violations, in an expedited manner. EPA's adequacy
review of the limited maintenance plan for the Municipality of Guaynabo
primarily focuses on whether the area qualifies for the applicable
limited maintenance plan policy for PM10. We have found the
maintenance plan for the Municipality of Guaynabo adequate for
conformity purposes under our limited maintenance plan policy.
    Transportation conformity is required by Clean Air Act section
176(c). EPA's conformity rule requires that transportation plans,
transportation improvement programs, and projects conform to state air
quality implementation plans (SIPs) and establishes the criteria and
procedures for determining whether or not they do. Conformity to a SIP
means that transportation activities will not produce new air quality
violations, worsen existing violations, or delay timely attainment of
the national ambient air quality standards.
    The criteria by which we determine whether a SIP's motor vehicle
emission budgets are adequate for conformity purposes are outlined in
40 CFR 93.118(e)(4). We've described our process for determining the
adequacy of submitted SIP budgets in our July 1, 2004 preamble starting
at 69 FR 40038 and we used the information in these resources in making
our adequacy determination. Please note that an adequacy review is
separate from EPA's completeness review, and should not be used to
prejudge EPA's ultimate approval action for the SIP. Even if we find a
limited maintenance plan adequate, the SIP could later be disapproved.

    Authority: 42 U.S.C. 7401-7671 q.

    Dated: July 28, 2009.
George Pavlou,
Acting Regional Administrator, Region 2.
[FR Doc. E9-19068 Filed 8-7-09; 8:45 am]

BILLING CODE 6560-50-P


[Federal Register Volume 81, Number 37 (Thursday, February 25, 2016)]
[Notices]
[Pages 9535-9543]
[FR Doc No: 2016-03944]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-77183; File No. SR-NYSEArca-2016-28]

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
of Proposed Rule Change To List and Trade Shares of RiverFront Dynamic
US Dividend Advantage ETF and RiverFront Dynamic US Flex-Cap ETF Under
NYSE Arca Equities Rule 8.600

February 19, 2016.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby
given that, on February 5, 2016, NYSE Arca, Inc. (the ``Exchange'' or
``NYSE Arca'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I, II,
and III below, which Items have been prepared by the self-regulatory
organization. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange proposes to list and trade shares of the following
under NYSE Arca Equities Rule 8.600 (``Managed Fund Shares''):
RiverFront Dynamic US Dividend Advantage ETF and RiverFront Dynamic US
Flex-Cap ETF. The proposed rule change is available on the Exchange's
Web site at www.nyse.com, at the principal office of the Exchange, and
at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the self-regulatory organization
included statements concerning the purpose of, and basis for, the
proposed rule change and discussed any comments it received on the
proposed rule change. The text of those statements may be examined at
the places specified in Item IV below. The Exchange has prepared
summaries, set forth in sections A, B, and C below, of the most
significant parts of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to list and trade shares (``Shares'') of the
following under NYSE Arca Equities Rule 8.600,\4\ which governs the
listing and trading of Managed Fund Shares: \5\ RiverFront Dynamic US
Dividend Advantage ETF and RiverFront Dynamic US Flex-Cap ETF, each
referred to as a ``Fund'' and collectively as the ``Funds.'' The Funds
are each a series of ALPS ETF Trust (``Trust''), a statutory trust
organized under the laws of the State of Delaware and registered with
the Commission as an open-end management investment company.\6\ The
Funds will be managed by ALPS Advisors, Inc. (``ALPS Advisors'' or the
``Adviser''). RiverFront Investment Group, LLC (``RiverFront'') is the
investment sub-adviser for the Funds (the ``Sub-Adviser'').
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    \4\ The Commission has previously approved listing and trading
on the Exchange of actively managed funds under Rule 8.600. See,
e.g., Securities Exchange Act Release Nos. 57801 (May 8, 2008), 73
FR 27878 (May 14, 2008) (SR-NYSEArca-2008-31) (order approving
Exchange listing and trading of twelve actively-managed funds of the
WisdomTree Trust); 66321 (February 3, 2012), 77 FR 6850 (February 9,
2012) (SR-NYSEArca-2011-95) (order approving listing and trading of
PIMCO Total Return Exchange Traded Fund); 66670 (March 28, 2012), 77
FR 20087 (April 3, 2012) (SR-NYSEArca-2012-09) (order approving
listing and trading of PIMCO Global Advantage Inflation-Linked Bond
Strategy Fund).
    \5\ A Managed Fund Share is a security that represents an
interest in an investment company registered under the Investment
Company Act of 1940 (15 U.S.C. 80a-1) (``1940 Act'') organized as an
open-end investment company or similar entity that invests in a
portfolio of securities selected by its investment adviser
consistent with its investment objectives and policies. In contrast,
an open-end investment company that issues Investment Company Units,
listed and traded on the Exchange under NYSE Arca Equities Rule
5.2(j)(3), seeks to provide investment results that correspond
generally to the price and yield performance of a specific foreign
or domestic stock index, fixed income securities index or
combination thereof.
    \6\ The Trust is registered under the 1940 Act. On December 4,
2015, the Trust filed with the Commission an amendment to its
registration statement on Form N-1A under the Securities Act of 1933
(15 U.S.C. 77a) (``Securities Act'') and the 1940 Act relating to
the Funds (File Nos. 333-148826 and 811-22175) (the ``Registration
Statement''). The description of the operation of the Trust and the
Funds herein is based, in part, on the Registration Statement. In
addition, the Commission has issued an order granting certain
exemptive relief to the Trust and the Adviser (as defined below)
under the 1940 Act. See Investment Company Act Release No. 30553
(June 11, 2013) (File No. 812-13884) (``Exemptive Order''). The
Funds will be offered in reliance upon the Exemptive Order issued to
the Trust and the Adviser.
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    Commentary .06 to Rule 8.600 provides that, if the investment
adviser to the investment company issuing Managed Fund Shares is
affiliated with a broker-dealer, such investment adviser shall erect a
``fire wall'' between the investment adviser and the broker-dealer with
respect to access to information concerning the composition and/or
changes to such investment company portfolio.\7\ In addition,

Commentary .06 further requires that personnel who make decisions on
the open-end fund's portfolio composition must be subject to procedures
designed to prevent the use and dissemination of material nonpublic
information regarding the open-end fund's portfolio. Each of ALPS
Advisors and RiverFront is not registered as a broker-dealer but is
affiliated with a broker-dealer. Each of ALPS Advisors and RiverFront
has implemented and will maintain a fire wall with respect to its
affiliated broker-dealer(s) regarding access to information concerning
the composition and/or changes to a Fund portfolio. In the event (a)
the Adviser or Sub-Adviser becomes newly affiliated with a broker-
dealer, or (b) any new adviser or sub-adviser becomes affiliated with a
broker-dealer, it will implement a fire wall with respect to such
broker-dealer affiliate regarding access to information concerning the
composition and/or changes to the portfolio, and will be subject to
procedures designed to prevent the use and dissemination of material
non-public information regarding such portfolio.
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    \7\ An investment adviser to an open-end fund is required to be
registered under the Investment Advisers Act of 1940 (the ``Advisers
Act''). As a result, the Adviser and Sub-Adviser and their related
personnel are subject to the provisions of Rule 204A-1 under the
Advisers Act relating to codes of ethics. This Rule requires
investment advisers to adopt a code of ethics that reflects the
fiduciary nature of the relationship to clients as well as
compliance with other applicable securities laws. Accordingly,
procedures designed to prevent the communication and misuse of non-
public information by an investment adviser must be consistent with
Rule 204A-1 under the Advisers Act. The Exchange represents that the
Adviser and Sub-Adviser, and their respective related personnel, are
subject to Investment Advisers Act Rule 204A-1. In addition, Rule
206(4)-7 under the Advisers Act makes it unlawful for an investment
adviser to provide investment advice to clients unless such
investment adviser has (i) adopted and implemented written policies
and procedures reasonably designed to prevent violation, by the
investment adviser and its supervised persons, of the Advisers Act
and the Commission rules adopted thereunder; (ii) implemented, at a
minimum, an annual review regarding the adequacy of the policies and
procedures established pursuant to subparagraph (i) above and the
effectiveness of their implementation; and (iii) designated an
individual (who is a supervised person) responsible for
administering the policies and procedures adopted under subparagraph
(i) above.
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RiverFront Dynamic US Dividend Advantage ETF
Principal Investments
    According to the Registration Statement, the investment objective
of the Fund will be to seek to provide capital appreciation and
dividend income. Under normal market conditions,\8\ the Fund will seek
to achieve its investment objective by investing at least at least 80%
of its net assets, plus the amount of any borrowings for investment
purposes, in securities of U.S. issuers,\9\ with at least 65% of its
assets in a portfolio of equity securities of publicly traded U.S.
companies with the potential for dividend growth. The equity securities
the Fund may invest in as part of its principal investments are common
stocks and common or preferred shares of real estate investment trusts
(``REITs'').\10\
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    \8\ The term ``under normal market conditions'' includes, but is
not limited to, the absence of extreme volatility or trading halts
in the securities markets or the financial markets generally;
circumstances under which a Fund's investments are made for
temporary defensive purposes; operational issues causing
dissemination of inaccurate market information; or force majeure
type events such as systems failure, natural or man-made disaster,
act of God, armed conflict, act of terrorism, riot or labor
disruption or any similar intervening circumstance.
    \9\ The Fund considers a ``U.S. issuer'' to be one (i) domiciled
or with a principal place of business or primary securities trading
market in the United States, or (ii) that derives a substantial
portion of its total revenues or profits from the United States.
    \10\ REITs are financial vehicles that pool investors' capital
to purchase or finance real estate. REITs are generally classified
as equity REITs, mortgage REITs or a combination of equity and
mortgage REITs. Equity REITs invest the majority of their assets
directly in real property and derive income primarily from the
collection of rents. Equity REITs can also realize capital gains by
selling properties that have appreciated in value. Mortgage REITs
invest the majority of their assets in real estate mortgages and
derive income from the collection of interest payments. REITs are
not taxed on income distributed to shareholders provided they comply
with the applicable tax requirements.
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    In selecting the Fund's portfolio securities, the Sub-Adviser
assembles a portfolio of eligible securities based on several core
attributes such as value, quality and momentum. The Sub-Adviser will
consider multiple proprietary factors within each core attribute, such
as the price-to-book value of a security when determining value, a
company's cash as a percentage of the company's market capitalization
when determining quality and a security's three month relative price
change when determining momentum. Additionally, within a given sector,
security selection will emphasize companies offering a meaningful
dividend yield premium over alternative investments within that sector.
This dividend yield emphasis is subject to quality screens intended to
limit exposure to companies whose financial characteristics suggest the
potential for dividend cuts. The Sub-Adviser then assigns each
qualifying security a score based on its core attributes, including its
dividend growth score, and selects the individual securities with the
highest scores for investment. In doing so, the Sub-Adviser will
utilize its proprietary optimization process to maximize the percentage
of high-scoring securities included in the portfolio. The Sub-Adviser
will also consider the market capitalization of the companies in which
the Fund may invest, the potential for dividend income, and the trading
volume of a company's shares in the secondary market.
    The Fund may invest in small, mid and large capitalization
companies. The Fund may also invest in other exchange-traded funds
(``ETFs'') \11\ and/or exchange-traded closed-end funds (``CEFs'')
which invest in equity securities.
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    \11\ For purposes of this filing, ETFs consist of Investment
Company Units (as described in NYSE Arca Equities Rule 5.2(j)(3)),
Portfolio Depositary Receipts (as described in NYSE Arca Equities
Rule 8.100; and Managed Fund Shares (as described in NYSE Arca
Equities Rule 8.600). All ETFs will be listed and traded in the U.S.
on a national securities exchange. The Funds will not invest in
leveraged or leveraged inverse ETFs.
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RiverFront Dynamic US Flex-Cap ETF
Principal Investments
    According to the Registration Statement, the investment objective
of the Fund will be to seek to provide capital appreciation. Under
normal market conditions,\12\ the Fund will seek to achieve its
investment objective by investing at least 80% of its net assets, plus
the amount of any borrowings for investment purposes, in securities of
U.S. issuers,\13\ with at least 65% of its assets in a portfolio of
equity securities of publicly traded U.S. companies. The equity
securities the Fund may invest in as part of its principal investments
are common stocks and common or preferred shares of REITs.
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    \12\ See note 7, supra.
    \13\ See note 8, supra.
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    In selecting the Fund's portfolio securities, the Sub-Adviser
assembles a portfolio of eligible securities based on several core
attributes such as value, quality and momentum. The Sub-Adviser will
consider multiple proprietary factors within each core attribute, such
as the price-to-book value of a security when determining value, a
company's cash as a percentage of the company's market capitalization
when determining quality and a security's three month relative price
change when determining momentum. The Sub-Adviser then assigns each
qualifying security a score based on its core attributes and selects
the individual securities with the highest scores for investment. In
doing so, the Sub-Adviser utilizes its proprietary optimization process
to maximize the percentage of high-scoring securities included in the
portfolio. The Sub-Adviser will also consider the market capitalization
of the companies in which the Fund may invest, and the trading volume
of a company's shares in the secondary market.
    The Fund may invest in small, mid and large capitalization
companies. The Fund may also invest in other ETFs \14\ and/or CEFs
which invest in equity securities.
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    \14\ See note 10, supra.
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Non-Principal Investments
    While each Fund will, under normal market conditions, principally
invest its assets in the securities and financial instruments as
described above, each Fund may invest its remaining assets in the
securities and financial instruments described below.
    A Fund may invest in the following other types of equity
securities: Non-

REIT preferred stock, convertible securities,\15\ master limited
partnerships (``MLPs'') \16\ and business development companies
(``BDCs'').\17\
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    \15\ Convertible securities are bonds, debentures, notes,
preferred stocks or other securities that may be converted or
exchanged (by the holder or by the issuer) into shares of the
underlying common stock (or cash or securities of equivalent value)
at a stated exchange ratio.
    \16\ MLPs are limited partnerships in which the ownership units
are publicly traded. Most MLPs operate in oil and gas related
businesses including energy processing and distribution. The
remaining MLPs operate in a variety of businesses including coal,
timber, other minerals, real estate, and some miscellaneous
businesses.
    \17\ A BDC is an exchange-traded closed-end investment company
that more closely resembles an operating company than a typical
investment company.
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    According to the Registration Statement, a Fund may invest in
equity securities of non-U.S. companies, including issuers in emerging
market countries.\18\
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    \18\ According to the Registration Statement, the Funds consider
an ``emerging market country'' to be any country whose issuers are
included in the Morgan Stanley Capital International Emerging
Markets Index and/or those countries considered to be developing by
the World Bank, the International Finance Corporation or the United
Nations. The Funds consider an ``emerging market issuer'' to be one
(i) domiciled or with a principal place of business or primary
securities trading market in an emerging market country, or (ii)
that derives a substantial portion of its total revenues or profits
from emerging market countries.
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    According to the Registration Statement, a Fund may also invest in
the following short-term instruments on an ongoing basis to provide
liquidity or for other reasons: Money market instruments, cash and cash
equivalents. Cash equivalents include the following: (i) Short-term
obligations issued by the U.S. Government; (ii) negotiable certificates
of deposit (``CDs''),\19\ fixed time deposits \20\ and bankers'
acceptances of U.S. and foreign banks and similar institutions; \21\
(iii) commercial paper rated at the date of purchase ``Prime-1'' by
Moody's Investors Service, Inc. or ``A-1+'' or ``A-1'' by Standard &
Poor's or, if unrated, of comparable quality as determined by the
Adviser or Sub-Adviser; \22\ (iv) repurchase agreements; \23\ and (v)
money market mutual funds.
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    \19\ CDs are interest-bearing instruments with a specific
maturity issued by banks and savings and loan institutions in
exchange for the deposit of funds.
    \20\ Time deposits are non-negotiable receipts issued by a bank
in exchange for the deposit of funds.
    \21\ Bankers' acceptances are bills of exchange or time drafts
drawn on and accepted by a commercial bank. Corporations use
bankers' acceptances to finance the shipment and storage of goods
and to furnish dollar exchange. Maturities are generally six months
or less.
    \22\ Commercial paper consists of short-term, promissory notes
issued by banks, corporations and other entities to finance short-
term credit needs. These securities generally are discounted but
sometimes may be interest bearing. Commercial paper consists of
short-term promissory notes issued primarily by corporations.
Commercial paper may be traded in the secondary market after its
issuance. As of September 30, 2015, the amount of commercial paper
outstanding (seasonally adjusted) was approximately $1024.1 billion.
See http://www.federalreserve.gov/releases/CP/default.htm.
    \23\ A repurchase agreement is an agreement under which a Fund
acquires a financial instrument (e.g., a security issued by the U.S.
government or an agency thereof, a banker's acceptance or a
certificate of deposit) from a seller, subject to resale to the
seller at an agreed upon price and date (normally, the next business
day). A repurchase agreement may be considered a loan collateralized
by securities. The resale price reflects an agreed upon interest
rate effective for the period the instrument is held by a Fund and
is unrelated to the interest rate on the underlying instrument.
These agreements may be made with respect to any of the portfolio
securities in which the Funds are authorized to invest.
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    In addition, according to the Registration Statement, a Fund may
use derivative instruments. Specifically, a Fund may use options,
futures, swaps and forwards, for hedging or risk management purposes or
as part of its investment practices.\24\
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    \24\ Derivative instruments are contracts whose value depends
on, or is derived from, the value of an underlying asset, reference
rate or index. These underlying assets, reference rates or indices
may be any one of the following: Stocks, interest rates, currency
exchange rates and stock indices.
    The Funds will only enter into transactions in derivative
instruments with counterparties that the Adviser or Sub-Adviser
reasonably believes are capable of performing under the contract and
will post collateral as required by the counterparty. The Funds will
seek, where possible, to use counterparties, as applicable, whose
financial status is such that the risk of default is reduced;
however, the risk of losses resulting from default is still
possible. The Adviser or Sub-Adviser will evaluate the
creditworthiness of counterparties on a regular basis. In addition
to information provided by credit agencies, the Adviser or Sub-
Adviser will review approved counterparties using various factors,
which may include the counterparty's reputation, the Adviser's or
Sub-Adviser's past experience with the counterparty and the price/
market actions of debt of the counterparty.
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    According to the Registration Statement, a Fund may enter into the
following derivatives: Futures on securities, indices, and currencies
and options on such futures; exchange-traded and OTC options on
securities, indices, and currencies; exchange-traded and OTC interest
rate swaps, cross-currency swaps, total return swaps, inflation swaps
and credit default swaps; and options on such swaps
(``swaptions'').\25\ The swaps in which a Fund will invest may be
cleared swaps or non-cleared. A Fund may enter into derivatives traded
in the U.S. or in non-U.S. countries. A Fund will collateralize its
obligations with liquid assets consistent with the 1940 Act and
interpretations thereunder.
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    \25\ Options on swaps are traded OTC. In the event that there
are exchange-traded options on swaps, a Fund may invest in these
instruments.
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    According to the Registration Statement, a Fund may invest in
forward currency contracts.\26\ Currency forward contracts may be used
to increase or reduce exposure to currency price movements. At the
discretion of the Adviser or Sub-Adviser, the Funds may enter into
forward currency exchange contracts for hedging purposes to help reduce
the risks and volatility caused by changes in foreign currency exchange
rates.
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    \26\ A forward currency contract is an obligation to buy or sell
a specified quantity of currency at a specified date in the future
at a specified price which may be any fixed number of days from the
date of the contract agreed upon by the parties, at a price set at
the time of the contract.
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    A Fund may gain exposure to foreign securities by purchasing U.S.
exchange-listed and traded American Depositary Receipts (``ADRs''),
exchange-traded European Depositary Receipts (``EDRs'') and Global
Depositary Receipts (``GDRs'', together with ADRs and EDRs,
``Depositary Receipts'').\27\
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    \27\ Depositary Receipts are receipts, typically issued by a
bank or trust issuer, which evidence ownership of underlying
securities issued by a non-U.S. issuer. Generally, ADRs, in
registered form, are denominated in U.S. dollars and are designed
for use in the U.S. securities markets. GDRs, in bearer form, are
issued and designed for use outside the United States and EDRs, in
bearer form, may be denominated in other currencies and are designed
for use in European securities markets. ADRs are receipts typically
issued by a U.S. bank or trust company evidencing ownership of the
underlying securities. EDRs are European receipts evidencing a
similar arrangement. GDRs are receipts typically issued by non-
United States banks and trust companies that evidence ownership of
either foreign or domestic securities. Non-exchange-listed ADRs will
not exceed 10% of a Fund's net assets.
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    According to the Registration Statement, the Funds may invest in
Rule 144A restricted securities.\28\
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    \28\ Restricted securities are securities that are not
registered under the Securities Act, but which can be offered and
sold to ``qualified institutional buyers'' under Rule 144A under the
Securities Act.
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Investment Restrictions
    Each Fund may invest up to an aggregate amount of 15% of its net
assets in illiquid assets (calculated at the time of investment),
including securities that are offered pursuant to Rule 144A under the
Securities Act deemed illiquid by the Adviser or Sub-Adviser.\29\ Each
Fund will monitor its portfolio liquidity on an ongoing basis to
determine whether, in light of current circumstances, an adequate level
of

liquidity is being maintained,\30\ and will consider taking appropriate
steps in order to maintain adequate liquidity if, through a change in
values, net assets, or other circumstances, more than 15% of a Fund's
net assets are held in illiquid assets. Illiquid assets include
securities subject to contractual or other restrictions on resale and
other instruments that lack readily available markets as determined in
accordance with Commission staff guidance.\31\
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    \29\ Rule 144A securities are securities which, while privately
placed, are eligible for purchase and resale pursuant to Rule 144A.
According to the Registration Statement, Rule 144A permits certain
qualified institutional buyers, such as a Fund, to trade in
privately placed securities even though such securities are not
registered under the Securities Act.
    \30\ In reaching liquidity decisions with respect to Rule 144A
securities, the Adviser or Sub-Adviser may consider the following
factors: The frequency of trades and quotes for the security; the
number of dealers willing to purchase or sell the security and the
number of other potential purchasers; dealer undertakings to make a
market in the security; and the nature of the security and the
nature of the marketplace in which it trades (e.g., the time needed
to dispose of the security, the method of soliciting offers, and the
mechanics of transfer).
    \31\ The Commission has stated that long-standing Commission
guidelines have required open-end funds to hold no more than 15% of
their net assets in illiquid securities and other illiquid assets.
See Investment Company Act Release No. 28193 (March 11, 2008), 73 FR
14618 (March 18, 2008), footnote 34. See also, Investment Company
Act Release No. 5847 (October 21, 1969), 35 FR 19989 (December 31,
1970) (Statement Regarding ``Restricted Securities''); Investment
Company Act Release No. 18612 (March 12, 1992), 57 FR 9828 (March
20, 1992) (Revisions of Guidelines to Form N-1A). A fund's portfolio
security is illiquid if it cannot be disposed of in the ordinary
course of business within seven days at approximately the value
ascribed to it by the fund. See Investment Company Act Release No.
14983 (March 12, 1986), 51 FR 9773 (March 21, 1986) (adopting
amendments to Rule 2a-7 under the 1940 Act); Investment Company Act
Release No. 17452 (April 23, 1990), 55 FR 17933 (April 30, 1990)
(adopting Rule 144A under the Securities Act).
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    The Funds intend to qualify for and to elect to be treated as
separate regulated investment companies (``RICs'') under Subchapter M
of the Internal Revenue Code.\32\
---------------------------------------------------------------------------

    \32\ 26 U.S.C. 851.
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    A Fund's investments will be consistent with a Fund's investment
objective and will not be used to enhance leverage. That is, while a
Fund will be permitted to borrow as permitted under the 1940 Act, a
Fund's investments will not be used to seek performance that is the
multiple or inverse multiple (i.e., 2Xs and 3Xs) of a Fund's primary
broad-based securities benchmark index (as defined in Form N-1A).\33\
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    \33\ A Fund's broad-based securities benchmark index will be
identified in a future amendment to the Registration Statement
following a Fund's first full calendar year of performance.
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    Not more than 10% of the net assets of a Fund in the aggregate
invested in exchange-traded equity securities shall consist of equity
securities whose principal market is not a member of the Intermarket
Surveillance Group (``ISG'') or party to a comprehensive surveillance
sharing agreement (``CSSA'') with the Exchange.\34\ Not more than 10%
of the net assets of a Fund in the aggregate invested in futures
contracts or options contracts shall consist of futures contracts or
exchange-traded options contracts whose principal market is not a
member of the ISG or is a market with which the Exchange does not have
a CSSA.
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    \34\ See notes 48-49, infra.
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Net Asset Value
    According to the Registration Statement, the net asset value
(``NAV'') per Share of each Fund will be computed by dividing the value
of the net assets of each Fund (i.e., the value of its total assets
less total liabilities) by the total number of Shares of the Fund
outstanding, rounded to the nearest cent. Expenses and fees, including
without limitation, the management fees, will be accrued daily and
taken into account for purposes of determining NAV.
    The NAV per Share will be calculated by each Fund's custodian and
determined as of the close of the regular trading session on the New
York Stock Exchange (``NYSE'') (ordinarily 4:00 p.m., Eastern Time) on
each day that such exchange is open. Any assets or liabilities
denominated in currencies other than the U.S. dollar will be converted
into U.S. dollars at the current market rates on the date of valuation
as quoted by one or more major banks or dealers that makes a two-way
market in such currencies (or a data service provider based on
quotations received from such banks or dealers). Information that
becomes known to a Fund or its agents after the NAV has been calculated
on a particular day will not generally be used to retroactively adjust
the price of a portfolio asset or the NAV determined earlier that day.
Each Fund reserves the right to change the time its NAV is calculated
if the Fund closes earlier, or as permitted by the Commission.
    According to the Registration Statement, the values of each Fund's
portfolio securities holdings will be based on market prices. Price
information for exchange-traded equity securities, including equity
securities of domestic and foreign companies, such as common stock,
ETFs and Depositary Receipts (excluding ADRs traded OTC), and preferred
securities, will be taken from the exchange where the security or asset
is primarily traded. Each Fund's securities holdings that are traded on
a national securities exchange will be valued based on their last sale
price or, in the case of the NASDAQ, at the NASDAQ official closing
price. Securities regularly traded in an over-the-counter market will
be valued at the latest quoted sale price in such market. Other
portfolio securities and assets for which market quotations are not
readily available will be valued based on fair value as determined in
good faith in accordance with procedures adopted by the Board, as
discussed below.
    Price information for money market instruments will be available
from major market data vendors.
    In the absence of a last reported sales price for an exchange-
traded security or asset, if no sales were reported, if a market
quotation for a security or asset is not readily available or the
Adviser or Sub-Adviser believes it does not otherwise accurately
reflect the market value of the security or asset at the time a Fund
calculates its NAV, the security or asset will be valued based on fair
value as determined in good faith by the Adviser or Sub-Adviser in
accordance with the Trust's valuation policies and procedures approved
by the Board and in accordance with the 1940 Act. A Fund may also use
fair value pricing in a variety of circumstances, including but not
limited to, trading in a security or asset has been suspended or
halted. Fair value pricing involves subjective judgments and it is
possible that a fair value determination for a security or asset may be
materially different than the value that could be realized upon the
sale of the security or asset.
    Values may be based on quotes obtained from a quotation reporting
system, established market makers or by an outside independent pricing
service. Prices obtained by an outside independent pricing service will
use information provided by market makers or estimates of market values
obtained from data related to investments or securities with similar
characteristics and may use a computerized grid matrix of securities
and its evaluations in determining what it believes is the fair value
of the portfolio securities.
    Derivatives for which market quotes are readily available will be
valued at market value. Local closing prices will be used for all
instrument valuation purposes. Futures will be valued at the last
reported sale or settlement price on the day of valuation. Swaps traded
on exchanges such as the Chicago Mercantile Exchange (``CME'') or the
Intercontinental Exchange (``ICE-US'') will use the applicable exchange
closing price where available. Foreign currency-denominated derivatives
will generally be valued as of the respective local region's market
close.
    With respect to specific derivatives:

     Currency spot and forward rates from major market data
vendors \35\ will generally be determined as of the NYSE Close.
---------------------------------------------------------------------------

    \35\ Major market data vendors may include, but are not limited
to: Thomson Reuters, JPMorgan Chase PricingDirect Inc., Markit Group
Limited, Bloomberg, Interactive Data Corporation or other major data
vendors.
---------------------------------------------------------------------------

     Futures on securities, indices, and currencies will
generally be valued at the settlement price of the relevant exchange.
     A total return swap on an index will be valued at the
publicly available index price. The index price, in turn, is determined
by the applicable index calculation agent, which generally values the
securities underlying the index at the last reported sale price.
     Exchange-traded non-equity options (for example, options
on bonds, Eurodollar options and U.S. Treasury options), index options,
and options on futures will generally be valued at the official
settlement price determined by the relevant exchange, if available.
     OTC foreign currency (FX) options will generally be valued
by pricing vendors.
     All other swaps such as interest rate swaps, inflation
swaps, swaptions, credit default swaps, and CDX/CDS will generally be
valued by pricing services.
Intra-Day Indicative Value
    The approximate value of a Fund's investments on a per-Share basis,
the Indicative Intra-Day Value (``IIV''), will be disseminated every 15
seconds during the Exchange Core Trading Session. The IIV should not be
viewed as a ``realtime'' update of NAV because the IIV will be
calculated by an independent third party and may not be calculated in
the exact same manner as NAV, which will be computed daily. For the
purposes of determining the IIV, the third party market data provider's
valuation of derivatives is expected to be similar to their valuation
of all securities. The third party market data provider may use market
quotes if available or may fair value securities against proxies (such
as swap or yield curves).
    With respect to specific derivatives:
     Foreign currency derivatives may be valued intraday using
market quotes, or another proxy as determined to be appropriate by the
third party market data provider.
     Futures may be valued intraday using the relevant futures
exchange data, or another proxy as determined to be appropriate by the
third party market data provider.
     Interest rate swaps and cross-currency swaps may be mapped
to a swap curve and valued intraday based on changes of the swap curve,
or another proxy as determined to be appropriate by the third party
market data provider.
     Index credit default swaps (such as, CDX/CDS) may be
valued using intraday data from market vendors, or based on underlying
asset price, or another proxy as determined to be appropriate by the
third party market data provider.
     Total return swaps may be valued intraday using the
underlying asset price, or another proxy as determined to be
appropriate by the third party market data provider.
     Exchange listed options may be valued intraday using the
relevant exchange data, or another proxy as determined to be
appropriate by the third party market data provider.
     OTC options on securities, indices, and currencies and
swaptions may be valued intraday through option valuation models (e.g.,
Black-Scholes) or using exchange-traded options as a proxy, or another
proxy as determined to be appropriate by the third party market data
provider.
Disclosed Portfolio
    The Funds' disclosure of derivative positions in the Disclosed
Portfolio will include information that market participants can use to
value these positions intraday. On a daily basis, the Adviser or Sub-
Adviser will disclose on the Funds' Web site the following information
regarding each portfolio holding, as applicable to the type of holding:
ticker symbol, CUSIP number or other identifier, if any; a description
of the holding (including the type of holding, such as the type of
swap); the identity of the security, commodity, index or other asset or
instrument underlying the holding, if any; for options, the option
strike price; quantity held (as measured by, for example, par value,
notional value or number of shares, contracts or units); maturity date,
if any; coupon rate, if any; effective date, if any; market value of
the holding; and the percentage weighting of the holding in each Fund's
portfolio. The Web site information will be publicly available at no
charge.
Impact on Arbitrage Mechanism
    The Adviser believes there will be minimal, if any, impact to the
arbitrage mechanism as a result of the use of derivatives. Market
makers and participants should be able to value derivatives as long as
the positions are disclosed with relevant information. The Adviser
believes that the price at which Shares trade will continue to be
disciplined by arbitrage opportunities created by the ability to
purchase or redeem creation Shares at their NAV, which should ensure
that Shares will not trade at a material discount or premium in
relation to their NAV.
    The Adviser does not believe there will be any significant impacts
to the settlement or operational aspects of a Fund's arbitrage
mechanism due to the use of derivatives. Because derivatives generally
are not eligible for in-kind transfer, they will typically be
substituted with a ``cash in lieu'' amount when a Fund processes
purchases or redemptions of creation units in-kind.
Creation and Redemption of Shares
    Shares may be created and redeemed in ``Creation Unit'' size
aggregations of at least 50,000 Shares. The size of a Creation Unit is
subject to change. In order to purchase Creation Units of a Fund, an
investor must generally deposit a designated portfolio of securities
(the ``Deposit Securities'') (and/or an amount in cash in lieu of some
or all of the Deposit Securities) and generally make a cash payment
referred to as the ``Cash Component.'' The list of the names and the
amounts of the Deposit Securities is made available by the Funds'
custodian through the facilities of the NSCC immediately prior to the
opening of business each day of the NYSE Arca. The Cash Component
represents the difference between the NAV of a Creation Unit and the
market value of the Deposit Securities. Creations and redemptions of
Shares may only be made through an Authorized Participant, as described
in the Registration Statement.
    Shares may be redeemed only in Creation Units at their NAV and only
on a day the NYSE Arca is open for business. The Funds' custodian will
make available immediately prior to the opening of business each day of
the NYSE Arca, through the facilities of the NSCC, the list of the
names and the amounts of each Fund's portfolio securities that will be
applicable that day to redemption requests in proper form (``Fund
Securities''). Fund Securities received on redemption may not be
identical to Deposit Securities, which are applicable to purchases of
Creation Units.
    Unless cash redemptions or partial cash redemptions are available
or specified for a Fund, the redemption proceeds will consist of the
Fund Securities, plus cash in an amount equal to the difference between
the NAV of Shares being redeemed as next determined after receipt by
the transfer agent of a redemption request in proper

form, and the value of the Fund Securities (the ``Cash Redemption
Amount''), less the applicable redemption fee and, if applicable, any
transfer taxes.\36\
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    \36\ Each Fund may, in certain circumstances, allow cash
creations or partial cash creations but not redemptions (or vice
versa) if the Adviser or Sub-Adviser believes it will allow a Fund
to adjust its portfolio in a manner which is more efficient for
shareholders. Each Fund may allow creations or redemptions to be
conducted partially in cash only where certain instruments are (i)
in the case of the purchase of a Creation Unit, not available in
sufficient quantity for delivery; (ii) not eligible for transfer
through either the NSCC or DTC; or (iii) not eligible for trading
due to local trading restrictions, local restrictions on securities
transfers or other similar circumstances. To the extent each Fund
allows creations or redemptions to be conducted wholly or partially
in cash, such transactions will be effected in the same manner for
all Authorized Participants on a given day except where: (i) Such
instruments are, in the case of the purchase of a Creation Unit, not
available to a particular Authorized Participant in sufficient
quantity; (ii) such instruments are not eligible for trading by an
Authorized Participant or the investor on whose behalf the
Authorized Participant is acting; or (iii) a holder of Shares of a
Fund would be subject to unfavorable income tax treatment if the
holder receives redemption proceeds in kind. According to the
Registration Statement, an additional variable charge for cash or
partial cash creations, and cash or partial cash redemptions, may
also be imposed to compensate a Fund for the costs associated with
buying the applicable securities.
---------------------------------------------------------------------------

Availability of Information
    The Funds' Web site (www.alpsetfs.com), which will be publicly
available prior to the public offering of Shares, will include a form
of the prospectus for each Fund that may be downloaded. The Funds' Web
site will include additional quantitative information updated on a
daily basis, including, for each Fund, (1) daily trading volume, the
prior business day's reported closing price, NAV and mid-point of the
bid/ask spread at the time of calculation of such NAV (the ``Bid/Ask
Price''),\37\ and a calculation of the premium and discount of the Bid/
Ask Price against the NAV, and (2) data in chart format displaying the
frequency distribution of discounts and premiums of the daily Bid/Ask
Price against the NAV, within appropriate ranges, for each of the four
previous calendar quarters. On each business day, before commencement
of trading in Shares in the Core Trading Session on the Exchange, each
Fund will disclose on its Web site the Disclosed Portfolio as defined
in NYSE Arca Equities Rule 8.600(c)(2) that will form the basis for a
Fund's calculation of NAV at the end of the business day.\38\
---------------------------------------------------------------------------

    \37\ The Bid/Ask Price of each Fund's Shares will be determined
using the mid-point of the highest bid and the lowest offer on the
Exchange as of the time of calculation of a Fund's NAV. The records
relating to Bid/Ask Prices will be retained by a Fund and its
service providers.
    \38\ Under accounting procedures to be followed by the Funds,
trades made on the prior Business Day (``T'') will be booked and
reflected in NAV on the current Business Day (``T+1''). Accordingly,
each Fund will be able to disclose at the beginning of the Business
Day the portfolio that will form the basis for the NAV calculation
at the end of the Business Day.
---------------------------------------------------------------------------

    In addition, a basket composition file, which will include the
security names and share quantities required to be delivered in
exchange for each Fund's Shares, together with estimates and actual
cash components, will be publicly disseminated daily prior to the
opening of the NYSE via NSCC. The basket represents one Creation Unit
of the applicable Fund.
    Investors can also obtain the Trust's Statement of Additional
Information (``SAI''), the Funds' Shareholder Reports, and Form N-CSR
and Form N-SAR, filed twice a year. The Trust's SAI and Shareholder
Reports are available free upon request from the Trust, and those
documents and the Form N-CSR and Form N-SAR may be viewed on-screen or
downloaded from the Commission's Web site at www.sec.gov. Information
regarding market price and trading volume for the Shares will be
continually available on a real-time basis throughout the day on
brokers' computer screens and other electronic services. Information
regarding the previous day's closing price and trading volume
information for the Shares will be published daily in the financial
section of newspapers.
    Quotation and last sale information for the Shares, U.S. exchange-
traded common stocks, as well as depositary receipts (excluding ADRs
traded OTC and GDRs), REITs, BDCs, preferred securities, CEFs and ETFs
(collectively, ``Exchange Traded Equities'') will be available via the
Consolidated Tape Association (``CTA'') high-speed line and from the
securities exchange on which they are listed. Price information for OTC
REITs and OTC common stocks will be available from major market data
vendors.
    Quotation and last sale information for GDRs will be available from
the securities exchange on which they are listed. Information relating
to futures and options on futures also will be available from the
exchange on which such instruments are traded. Information relating to
exchange-traded options will be available via the Options Price
Reporting Authority.
    Quotation information from brokers and dealers or pricing services
will be available for ADRs traded OTC and non-exchange-traded
derivatives, including forwards, swaps and certain options. Pricing
information regarding each asset class in which the Funds will invest
is generally available through nationally recognized data services
providers through subscription agreements.
    In addition, the IIV, as defined in NYSE Arca Equities Rule 8.600
(c)(3), will be widely disseminated by one or more major market data
vendors at least every 15 seconds during the Core Trading Session.\39\
The dissemination of the IIV, together with the Disclosed Portfolio,
will allow investors to determine the value of the underlying portfolio
of each Fund on a daily basis and provide a close estimate of that
value throughout the trading day.
---------------------------------------------------------------------------

    \39\ Currently, the Exchange understands that several major
market data vendors display and/or make widely available IIVs taken
from CTA or other data feeds.
---------------------------------------------------------------------------

Trading Halts
    With respect to trading halts, the Exchange may consider all
relevant factors in exercising its discretion to halt or suspend
trading in the Shares of a Fund.\40\ Trading in Shares of a Fund will
be halted if the circuit breaker parameters in NYSE Arca Equities Rule
7.12 have been reached. Trading also may be halted because of market
conditions or for reasons that, in the view of the Exchange, make
trading in the Shares inadvisable. These may include: (1) The extent to
which trading is not occurring in the securities and/or the financial
instruments comprising the Disclosed Portfolio of a Fund; or (2)
whether other unusual conditions or circumstances detrimental to the
maintenance of a fair and orderly market are present. Trading in the
Shares will be subject to NYSE Arca Equities Rule 8.600(d)(2)(D), which
sets forth circumstances under which Shares of a Fund may be halted.
---------------------------------------------------------------------------

    \40\ See NYSE Arca Equities Rule 7.12, Commentary .04.
---------------------------------------------------------------------------

Trading Rules
    The Exchange deems the Shares to be equity securities, thus
rendering trading in the Shares subject to the Exchange's existing
rules governing the trading of equity securities. Shares will trade on
the NYSE Arca Marketplace from 4 a.m. to 8 p.m. Eastern Time in
accordance with NYSE Arca Equities Rule 7.34 (Opening, Core, and Late
Trading Sessions). The Exchange has appropriate rules to facilitate
transactions in the Shares during all trading sessions. As provided in
NYSE Arca Equities Rule 7.6, Commentary .03, the minimum price
variation (``MPV'') for quoting and entry of orders in equity
securities traded on the NYSE Arca

Marketplace is $0.01, with the exception of securities that are priced
less than $1.00 for which the MPV for order entry is $0.0001.
    The Shares will conform to the initial and continued listing
criteria under NYSE Arca Equities Rule 8.600. The Exchange represents
that, for initial and/or continued listing, each Fund will be in
compliance with Rule 10A-3 \41\ under the Act, as provided by NYSE Arca
Equities Rule 5.3. A minimum of 100,000 Shares of each Fund will be
outstanding at the commencement of trading on the Exchange. The
Exchange will obtain a representation from the issuer of the Shares
that the NAV per Share will be calculated daily and that the NAV and
the Disclosed Portfolio of each Fund will be made available to all
market participants at the same time.
---------------------------------------------------------------------------

    \41\ 17 CFR 240.10A-3.
---------------------------------------------------------------------------

Surveillance
    The Exchange represents that trading in the Shares will be subject
to the existing trading surveillances, administered by the Exchange or
the Financial Industry Regulatory Authority (``FINRA'') on behalf of
the Exchange, which are designed to detect violations of Exchange rules
and applicable federal securities laws. The Exchange represents that
these procedures are adequate to properly monitor Exchange trading of
the Shares in all trading sessions and to deter and detect violations
of Exchange rules and federal securities laws applicable to trading on
the Exchange.\42\
---------------------------------------------------------------------------

    \42\ FINRA conducts cross market surveillances of trading on the
Exchange pursuant to a regulatory services agreement. The Exchange
is responsible for FINRA's performance under this regulatory
services agreement.
---------------------------------------------------------------------------

    The surveillances referred to above generally focus on detecting
securities trading outside their normal patterns, which could be
indicative of manipulative or other violative activity. When such
situations are detected, surveillance analysis follows and
investigations are opened, where appropriate, to review the behavior of
all relevant parties for all relevant trading violations.
    The Exchange or FINRA, on behalf of the Exchange, will communicate
as needed regarding trading in the Shares, Exchange Traded Equities,
and certain exchange-traded options and futures with other markets and
other entities that are members of the ISG,\43\ and the Exchange, or
FINRA on behalf of the Exchange, may obtain trading information
regarding trading in the Shares, Exchange Traded Equities, and certain
exchange-traded options and futures from such markets and other
entities. In addition, the Exchange may obtain information regarding
trading in the Shares, Exchange Traded Equities, and certain exchange-
traded options and futures from markets and other entities that are
members of ISG or with which the Exchange has in place a CSSA.\44\
---------------------------------------------------------------------------

    \43\ For a list of the current members of ISG, see
www.isgportal.org. The Exchange notes that not all components of the
Disclosed Portfolio may trade on markets that are members of ISG or
with which the Exchange has in place a CSSA.
    \44\ Certain of the exchange-traded equity instruments in which
a Fund may invest may trade in markets that are not members of ISG.
---------------------------------------------------------------------------

    Not more than 10% of the net assets of a Fund in the aggregate
invested in exchange-traded equity securities shall consist of equity
securities whose principal market is not a member of the ISG or party
to a CSSA with the Exchange. Not more than 10% of the net assets of a
Fund in the aggregate invested in futures contracts or options
contracts shall consist of futures contracts or exchange-traded options
contracts whose principal market is not a member of the ISG or is a
market with which the Exchange does not have a CSSA.
    In addition, the Exchange also has a general policy prohibiting the
distribution of material, non-public information by its employees.
Information Bulletin
    Prior to the commencement of trading, the Exchange will inform its
Equity Trading Permit (``ETP'') Holders in an Information Bulletin
(``Bulletin'') of the special characteristics and risks associated with
trading the Shares. Specifically, the Bulletin will discuss the
following: (1) The procedures for purchases and redemptions of Shares
in Creation Units (and that Shares are not individually redeemable);
(2) NYSE Arca Equities Rule 9.2(a), which imposes a duty of due
diligence on its ETP Holders to learn the essential facts relating to
every customer prior to trading the Shares; (3) the risks involved in
trading the Shares during the Opening and Late Trading Sessions when an
updated IIV will not be calculated or publicly disseminated; (4) how
information regarding the IIV and the Disclosed Portfolio is
disseminated; (5) the requirement that ETP Holders deliver a prospectus
to investors purchasing newly issued Shares prior to or concurrently
with the confirmation of a transaction; and (6) trading information.
    In addition, the Bulletin will reference that each Fund is subject
to various fees and expenses described in the Registration Statement.
The Bulletin will discuss any exemptive, no-action, and interpretive
relief granted by the Commission from any rules under the Act. The
Bulletin will also disclose that the NAV for the Shares will be
calculated after 4:00 p.m. Eastern Time each trading day.
2. Statutory Basis
    The basis under the Act for this proposed rule change is the
requirement under Section 6(b)(5) \45\ that an exchange have rules that
are designed to prevent fraudulent and manipulative acts and practices,
to promote just and equitable principles of trade, to remove
impediments to, and perfect the mechanism of a free and open market
and, in general, to protect investors and the public interest.
---------------------------------------------------------------------------

    \45\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange believes that the proposed rule change is designed to
prevent fraudulent and manipulative acts and practices in that the
Shares will be listed and traded on the Exchange pursuant to the
initial and continued listing criteria in NYSE Arca Equities Rule
8.600. The Exchange has in place surveillance procedures that are
adequate to properly monitor trading in the Shares in all trading
sessions and to deter and detect violations of Exchange rules and
federal securities laws applicable to trading on the Exchange.
    The proposed rule change is designed to promote just and equitable
principles of trade and to protect investors and the public interest in
that each of the Adviser and the Sub-Adviser each is affiliated with a
broker-dealer and has represented that it has implemented a fire wall
with respect to its broker-dealer affiliate(s) regarding access to
information concerning the composition and/or changes to the portfolio.
The Exchange will obtain a representation from the issuer of the Shares
that the NAV per Share will be calculated daily and that the NAV and
the Disclosed Portfolio will be made available to all market
participants at the same time.
    The Exchange or FINRA, on behalf of the Exchange, will communicate
as needed regarding trading in the Shares, underlying Exchange Traded
Equities, and certain exchange-traded options and futures with other
markets and other entities that are members of the ISG, and the
Exchange or FINRA, on behalf of the Exchange, may obtain trading
information regarding trading in the Shares, underlying Exchange Traded
Equities, and certain exchange-traded options and futures from such
markets and other entities. In addition, the Exchange may obtain
information regarding trading in the Shares,

underlying Exchange Traded Equities, and certain exchange-traded
options and futures from markets and other entities that are members of
ISG or with which the Exchange has in place a CSSA.
    Each Fund's disclosure of derivative positions in the Disclosed
Portfolio will include information that market participants can use to
value these positions intraday. On a daily basis, the Funds will
disclose on a Fund's Web site the following information regarding each
portfolio holding, as applicable to the type of holding: ticker symbol,
CUSIP number or other identifier, if any; a description of the holding
(including the type of holding, such as the type of swap); the identity
of the security, commodity, index or other asset or instrument
underlying the holding, if any; for options, the option strike price;
quantity held (as measured by, for example, par value, notional value
or number of shares, contracts or units); maturity date, if any; coupon
rate, if any; effective date, if any; market value of the holding; and
the percentage weighting of the holding in each Fund's portfolio. Price
information for the equity securities held by a Fund will be available
through major market data vendors and on the applicable securities
exchanges on which such securities are listed and traded. In addition,
a large amount of information will be publicly available regarding the
Funds and the Shares, thereby promoting market transparency. Moreover,
the IIV will be widely disseminated by one or more major market data
vendors at least every 15 seconds during the Exchange's Core Trading
Session. On each business day, before commencement of trading in Shares
in the Core Trading Session on the Exchange, each Fund will disclose on
its Web site the Disclosed Portfolio that will form the basis for a
Fund's calculation of NAV at the end of the business day. Information
regarding market price and trading volume of the Shares will be
continually available on a real-time basis throughout the day on
brokers' computer screens and other electronic services, and quotation
and last sale information will be available via the CTA high-speed
line. The Web site for the Funds will include a form of the prospectus
for each Fund and additional data relating to NAV and other applicable
quantitative information. Moreover, prior to the commencement of
trading, the Exchange will inform its ETP Holders in an Information
Bulletin of the special characteristics and risks associated with
trading the Shares. Trading in Shares of a Fund will be halted if the
circuit breaker parameters in NYSE Arca Equities Rule 7.12 have been
reached or because of market conditions or for reasons that, in the
view of the Exchange, make trading in the Shares inadvisable, and
trading in the Shares will be subject to NYSE Arca Equities Rule
8.600(d)(2)(D), which sets forth circumstances under which Shares of a
Fund may be halted. In addition, as noted above, investors will have
ready access to information regarding each Fund's holdings, the IIV,
the Disclosed Portfolio, and quotation and last sale information for
the Shares.
    The proposed rule change is designed to perfect the mechanism of a
free and open market and, in general, to protect investors and the
public interest in that it will facilitate the listing and trading of
an additional type of actively-managed exchange-traded product that
will enhance competition among market participants, to the benefit of
investors and the marketplace. As noted above, the Exchange has in
place surveillance procedures relating to trading in the Shares and may
obtain information via ISG from other exchanges that are members of ISG
or with which the Exchange has entered into a CSSA. Not more than 10%
of the net assets of a Fund in the aggregate invested in exchange-
traded equity securities shall consist of equity securities whose
principal market is not a member of the ISG or party to a CSSA with the
Exchange. Not more than 10% of the net assets of a Fund in the
aggregate invested in futures contracts or options contracts shall
consist of futures contracts or options contracts whose principal
market is not a member of ISG or is a market with which the Exchange
does not have a CSSA. In addition, as noted above, investors will have
ready access to information regarding each Fund's holdings, the IIV,
the Disclosed Portfolio, and quotation and last sale information for
the Shares.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purpose of the Act. The Exchange notes that the
proposed rule change will facilitate the listing and trading of
additional types of actively-managed exchange-traded products that
primarily hold equity securities and will enhance competition among
market participants, to the benefit of investors and the marketplace.

C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others

    No written comments were solicited or received with respect to the
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

    Within 45 days of the date of publication of this notice in the
Federal Register or up to 90 days (i) as the Commission may designate
if it finds such longer period to be appropriate and publishes its
reasons for so finding or (ii) as to which the self-regulatory
organization consents, the Commission will:
    (A) By order approve or disapprove the proposed rule change, or
    (B) institute proceedings to determine whether the proposed rule
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-NYSEArca-2016-28 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.

All submissions should refer to File Number SR-NYSEArca-2016-28. This
file number should be included on the subject line if email is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the

provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549, on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available
for inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-NYSEArca-2016-28 and should
be submitted on or before March 17, 2016.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\46\
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    \46\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2016-03944 Filed 2-24-16; 8:45 am]
 BILLING CODE 8011-01-P