RYJ

Guggenheim Raymond James SB-1 Equity ETF

 

Fund Summary

The Guggenheim Raymond James SB-1 Equity ETF (NYSE Arca: RYJ), seeks investment results that correspond generally to the performance, before the Fund’s fees and expenses, of an equity index called the Raymond James SB-1 Equity Index (the “SB-1 Equity Index” or the “Index”). The Fund will invest at least 80% of its total assets in securities that comprise the Index and depositary receipts representing securities that comprise the Index (or underlying securities representing ADRs that comprise the Index). The Fund will also normally invest at least 80% of its total assets in securities that comprise the Index and depositary receipts representing securities that comprise the Index (or underlying securities representing ADRs that comprise the Index). Guggenheim Funds Investment Advisors, LLC (the "Investment Adviser") seeks a correlation over time of 0.95 or better between the Fund’s performance and the performance of the total return of the Index less any expenses or distributions. A figure of 1.00 would represent perfect correlation.

The Fund, using a "passive" or "indexing" investment approach, seeks to replicate, before fees and expenses, the performance of the SB-1 Equity Index. The SB-1 Equity Index is composed of all equity securities rated Strong Buy 1 ("SB-1") by Raymond James & Associates, Inc. ("Raymond James & Associates"), an affilliate of Raymond James Research Services, LLC ("Raymond James" or the "Index Provider"), as of each rebalance and reconstitution date. Index constituents include equity securities of all market capitalizations, as defined by the Index Provider, that trade on a U.S. securities exchange, including common stocks, American depositary receipts ("ADRs"), real-estate investment trusts ("REITs") and master limited partnerships ("MLPs"). The depositary receipts included in the Index may be sponsored or unsponsored. The number of securities in the Index may vary depending on the number of equity security rated SB-1 by Raymond James & Associates.

Top Fund Holdings

as of 7/28/14 View All Holdings
RF MICRO DEVICES INC 0.79 %
POLARIS INDUSTRIES INC 0.79 %
EMC CORPORATION 0.78 %
SKYWORKS SOLUTIONS INC 0.77 %
MALIBU BOATS INC - A 0.76 %
CAMERON INTERNATIONAL CORPORATION 0.76 %
NASDAQ OMX GROUP INC/THE 0.76 %
ARRIS GROUP INC 0.75 %
COPA HOLDINGS SA-CLASS A 0.75 %
CYRUSONE INC 0.75 %

TOP FUND SECTORS

as of 3/31/14

SECTOR WEIGHTING
Financials 27.22 %
Consumer Discretionary 25.25 %
Information Technology 19.58 %
Industrials 12.48 %
Energy 7.45 %
Health Care 5.63 %
Telecommunication Services 1.61 %
Materials 0.81 %

All data is provided by Guggenheim Funds Distributors, LLC, or Morningstar. Data is subject to change on a daily basis and represents a percentage of the Fund’s holdings, excluding cash. The securities mentioned are provided for informational purposes only and should not be deemed as a recommendation to buy or sell.


*Morningstar category is based on the underlying securities of the ETF and not the objective. The Morningstar Rating™ is provided for those exchange-traded funds (“ETFs”) with at least a three-year history. Ratings are based on the ETF’s Morningstar Risk-Adjusted Return measure which accounts for variation in monthly performance, placing more emphasis on downward variations and rewarding consistent performance. An ETF’s risk-adjusted return includes a brokerage commission estimate. This estimate is intended to reflect what an average investor would pay when buying or selling an ETF. PLEASE NOTE, this estimate is subject to change and the actual brokerage commission an investor pays may be higher or lower than this estimate. Morningstar compares each ETF’s risk-adjusted return to the open-end mutual fund rating breakpoints for that category. Consistent with the open-end mutual fund ratings, the top 10% of ETFs in each category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars and the bottom 10% receive 1 star. The overall rating for an ETF is based on a weighted average of the time-period ratings (e.g., the ETF’s 3-, 5-, and 10-year rating). The determination of an ETF’s rating does not affect the retail open end mutual fund data published by Morningstar. Past performance is no guarantee of future results.

Overall Morningstar RatingTM *

as of 3/31/14

Among Mid-Cap Blend Funds

This Fund was rated, based on its risk-adjusted returns, 4 stars for 3 years, 5 stars for 5 years, and 5 stars Overall out of 20, 15 and 20 Mid-Cap Blend funds, respectively

Fund Profile

Symbol RYJ
Exchange NYSE Arca
NAV Symbol (IIV) RYJIV
CUSIP 18383M613
Fund Inception Date 5/19/06
Distribution Schedule (if any) Annually
Gross Expense Ratio 0.83 %
Net Expense Ratio 0.83 %
Fiscal Year-End 8/31
Investment Adviser Guggenheim Funds Investment Advisors, LLC
Distributor Guggenheim Funds Distributors, LLC
Raymond James SB-1 Equity IndexRJSBI
Index Provider Raymond James

The expense ratio is expressed as a unitary fee and covers all expenses of the Fund, except for the fee payments under the investment advisory agreement, distribution fees, if any, brokerage expenses, taxes, interest, litigation expenses and other extraordinary expenses.

The gross expense ratio reflects the fund’s actual total annual operating expense ratio, gross of any fee waivers or expense reimbursements as of its most recent prospectus.

Fund Statistics

as of 7/28/14 Price History
  MARKET PRICE NAV
Close $34.33 $34.32
Change ($0.14) ($0.16)
52-Week High $35.84 $35.77
52-Week Low $29.07 $29.06
Bid/Ask Midpoint $34.33
Bid/Ask Premium (Discount) 0.03 %
Volume 12,188
Shares Outstanding 7,772,822
Total Managed Assets $266,759,931

After the close of trading on September 3, 2008, the Claymore/Raymond James SB-1 Equity ETF (the "Fund") acquired the assets and adopted the financial and performance history of the Claymore/Raymond James SB-1 Equity Fund (the "Predecessor Fund"). Therefore, all price history information prior to the acquisition and adoption relates exclusively to the Predecessor Fund and is shown for historical purposes only

Fund Characteristics

as of 3/31/14

Number of Securities129
Average Market Capitalization $1.3 Bil
Price/Earnings (P/E) 20.6 x
Price/Book (P/B) 2.4 x
Beta 1.07
Alpha 0.47
Standard Deviation (Fund / S&P Midcap 400 Index) 16.91/15.36

P/E ratio is a harmonic weighted average and is equal to a security’s market capitalization divided by it after-tax earnings over the most recent 12-month period.

P/B ratio is a harmonic weighted average and is equal to a security’s market capitalization divided by its book value.

Alpha is a statistical measurement that depicts the performance difference between a fund’s return and an underlying performance benchmark, given a fund’s level of volatility, measured by beta. The benchmark will always reflect an alpha of 0.00%. A positive alpha indicates a fund has performed better than its beta would predict in the stated period.

Beta is the measure of a fund’s sensitivity to an index. By definition, the beta of an index is 1.00. Any fund with a higher beta is more volatile than the index. Likewise, any portfolio with a lower beta will be less volatile than the index in the stated period.

Standard deviation is a measure of historical volatility that indicates the degree to which an investment’s returns fluctuate around its average return. Generally, a higher standard deviation indicates a more risky investment.

Average market capitalization is the geometric mean of the market capitalization s for all securities in a fund’s portfolio.

Weighted average coupon is calculated by weighting each bond’s coupon by its relative size in the portfolio.

Weighted average bond price is a weighted average of individual bond prices.

Weighted average option-adjusted duration is a weighted average which measures the sensitivity of the price (the value of principal), incorporating the expected duration-shortening effect of an embedded call provision, of a fixed-income investment to a change in interest rates. The larger the duration number, the greater the interest-rate risk for bond prices.

Average maturity is the length of time until the principal amount of a bond must be repaid.

Average effective duration measures the sensitivity of the price (value of principal) of a fixed income investment to a change in interest rates. The larger the duration number, the greater the interest rate risk for bond prices.

Current Distribution

View Distribution History
Ex-Date 12/24/13
Record Date 12/27/13
Payable Date 12/31/13
Distribution per Share $0.113000

The extent the Current Distribution is comprised of something other than Income, such as Return of Capital, please refer to the applicable Rule 19a-1 Notice found on the Fund's website under the Literature section. If the Current Distribution is comprised solely from Income, a Rule 19a-1 Notice will not be produced and posted.

Past performance is not a guarantee of future results.

INDEX METHODOLOGY

The Index is composed of all equity securities rated SB-1 by Raymond James & Associates as of each rebalance and reconstitution date, with the relative weighting of each constituent determined according to a modified equal-weighting methodology, as described below. The number of securities rated SB-1 may be modified on any day as a result of upgrades and/or downgrades of securities’ ratings by Raymond James & Associates analysts; however, the Index will be reconstituted and rebalanced twice per calendar month.

There are currently four rating categories used by Raymond James & Associates analysts, with SB-1 being the highest rating. A rating of SB-1 indicates generally that the Raymond James & Associates analyst assigning the rating expects the stock to achieve total return targets over the next six months and to outperform the S&P 500 over that period. In the case of certain higher-yielding or more conservative equities, a rating of SB-1 indicates that the Raymond James & Associates analyst assigning the rating expects such equities to achieve total return targets over the next 12 months. The ratings assigned by Raymond James & Associates analysts represent such analysts’ judgments given available public facts and information and are not intended as guarantees of investment performance of rated securities or of the Index.

Raymond James & Associates Equity Research Department currently includes more than 45 equity analysts and publishes research on approximately 700 companies. Securities rated by Raymond James & Associates analysts include equity securities of U.S. issuers and U.S. dollar-denominated equity securities of foreign issuers, in each case that are traded on U.S. securities exchanges. As of November 30, 2010, 146 securities received a rating of SB-1 from Raymond James & Associates analysts. The number of securities rated SB-1 may be modified on any day as a result of upgrades and/or downgrades of securities’ ratings by Raymond James & Associates analysts.

INDEX CONSTRUCTION

  1. Index constituents will include all securities rated SB-1 by a Raymond James & Associates analyst as defined above.
  2. The Index will seek to include each SB-1 rated security in equal dollar-weighted percentages relative to the total value of the entire Index of SB-1 rated securities (“Equal Portfolio Weight”). Using the following method, in instances in which there is comparatively little trading volume in a SB-1 rated security, the Index will limit its weighting in that constituent. Upon initial selection and on each rebalancing and reconstitution day, the Index will calculate for each SB-1 rated security the average product of the closing price multiplied by the trading volume for such stock for the 60 trading days prior to the rebalancing and reconstitution day to provide the “Average Price-Volume Amount.” For any Index constituent that the Average Price-Volume Amount is less than $1,000,000 per day, that security’s weight will be reduced to a proportion of the Equal Portfolio Weight equal to the ratio of its Average Price-Volume Amount over $1,000,000 (the “Liquidity Cap”). To the extent that the Index’s weighting in a security is limited as a result of the Liquidity Cap, the difference between the equal weight position and the capped position will be reallocated equally among all other Index constituents.
  3. At each Index rebalancing and reconstitution, all Index constituents that are no longer rated SB-1 on the date of the rebalancing and reconstitution will be removed from the Index and all securities rated SB-1 on the date of the rebalancing and reconstitution that are not currently part of the Index will be added.
  4. In the event a constituent is downgraded by Raymond James & Associates and is no longer rated SB-1 subsequent to adding the security as an Index constituent, such constituent will remain a part of the Index until the next rebalancing and reconstitution date following such downgrade. In the event a security is upgraded by Raymond James & Associates to a rating of SB-1 between rebalancing and reconstitution dates, the constituent will be added to the Index at the next rebalance and reconstitution date.
  5. The Index will be rebalanced and reconstituted twice per calendar month.

RISKS AND OTHER CONSIDERATIONS

 

Investors should consider the following risk factors and special considerations associated with investing in the fund, which may cause you to lose money, including the entire principal amount that you invest.

Equity Risk: The value of the securities held by the fund will fall due to general market and economic conditions, perceptions regarding the industries in which the issuers of securities held by the fund participate, or factors relating to specific companies in which the fund invests.

Foreign Investment Risk: The fund’s investments in non-U.S. issuers, although generally limited to ADRs, may involve unique risks compared to investing in securities of U.S. issuers, including less market liquidity, generally greater market volatility than U.S. securities and less complete financial information than for U.S. issuers.

Emerging Markets Risk: Emerging market countries are countries that major international financial institutions, such as the World Bank, generally consider to be less economically mature than developed nations.

Small and Medium-Sized Company Risk: Investing in securities of small and medium-sized companies involves greater risk than is customarily associated with investing in larger, more established companies.

Micro-Cap Company Risk: Micro-cap stocks involve substantially greater risks of loss and price fluctuations because their earnings and revenues tend to be less predictable (and some companies may be experiencing significant losses), and their share prices tend to be more volatile and their markets less liquid than companies with larger market capitalizations.

Concentration Risk: At any given time, the fund may invest a substantial portion of its assets in the securities of issuers in any single sector of the economy and may invest up to 25% of its total assets in securities of issuers in one particular industry, and may invest more than 25% of its total assets in securities of issuers in one particular industry in the event that the composition of the issuers of securities rated SB-1 on a rebalancing day results in such an industry concentration in the Index.

Computer/ Technology Sector Risk: In addition to the sector concentration risk noted above, companies in the computer/technology sector may be adversely affected by competitive pressure, short product cycles and rapid obsolescence, regulatory changes, and economic conditions.

REIT Risk: Investments in securities of real estate companies involve risks. These risks include, among others, adverse changes in national, state or local real estate conditions; obsolescence of properties; changes in the availability, cost and terms of mortgage funds; and the impact of changes in environmental laws.

MLP Risk: Investments in securities of MLPs involve risks that differ from an investment in common stock. Holders of the units of MLPs have more limited control and limited rights to vote on matters affecting the partnership.

Financial Services Sector Risk: The financial services industries are subject to extensive government regulation, can be subject to relatively rapid change due to increasingly blurred distinctions between service segments, and can be significantly affected by availability and cost of capital funds, changes in interest rates, the rate of corporate and consumer debt defaults, and price competition. In addition, the deterioration of the credit markets since late 2007 generally has caused an adverse impact in a broad range of markets, including U.S. and international credit and interbank money markets generally, thereby affecting a wide range of financial institutions and markets.

Risks Relating To Raymond James & Associates Equity Securities Ratings: The fund will seek to construct and maintain a portfolio consisting of the equity securities rated SB-1 by Raymond James & Associates analysts. Changes in the ratings methodologies or in the scope of equity research by Raymond James & Associates may have an adverse effect on the ability of the fund to pursue its investment strategy. Please see the Prospectus for more details and risks pertaining to the following subjects: the details of and possible changes in the ratings system used by Raymond James & Associates analysts, Raymond James & Associates’ provision of research, the subsequent risks and procedures in the event that an analyst leaves Raymond James & Associates, the effects of the modification of research reports published by Raymond James & Associates, including the timing of updating this research and the timing of communicating to investors a change in sentiment pertaining to a covered security (based on the laws, rules and regulations of the SEC and of other regulatory agencies).

Portfolio Turnover Risk: The fund may engage in active and frequent trading of its portfolio securities in connection with the rebalancing of the Index, and therefore the fund’s investments, every two weeks. A high portfolio turnover rate (such as 100% or more) could result in high brokerage costs. While a high portfolio turnover rate can result in an increase in taxable capital gains distributions  to the fund’s shareholders, the fund will seek to utilize the creation and redemption in kind mechanism to minimize capital gains to the extent possible. In addition the fund is subject to Non-Correlation Risk, Replication Management Risk and Issuer-Specific Changes.

The Fund’s Shares will change in value, and you could lose money by investing in the Fund. The Fund may not achieve its investment objective. An investment in the Fund has not been guaranteed, sponsored, recommended, or approved by the United States, or any agency, instrumentality or officer of the United States, has not been insured by the Federal Deposit Insurance Corporation (FDIC) and is not guaranteed by and is not otherwise an obligation of any bank or insured depository institution.

The Fund will issue and redeem Shares at NAV only in a large specified number of Shares called a “Creation Unit” or multiples thereof. A Creation Unit consists of 50,000 Shares. The Fund generally issues and redeems Creation Units principally in-kind. Except when aggregated in Creation Units, the Shares are not redeemable securities of the Fund. Individual Shares of the Fund may only be purchased and sold in secondary market transactions through brokers. Shares of the Fund are listed for trading on NYSE Arca, Inc. (“NYSE Arca”) and because Shares trade at market prices rather than NAV, Shares of the Fund may trade at a price greater than or less than NAV.

Investors buying or selling ETF shares on the secondary market may incur brokerage costs and other transactional fees. Shares of ETFs may fluctuate in price due to daily changes in trading volume. At times, shares may not have a high volume of trading. 

The Fund is not sponsored, endorsed, sold or promoted by Raymond James Research Services, LLC (“Licensor”). Licensor makes no representation or warranty, express or implied, regarding the advisability of investing in securities generally or in the Fund particularly or the ability of the Raymond James SB-1 Index (“Index”) to track general market performance. Licensor’s only relationship to Guggenheim Funds Investment Advisors, LLC (the “Licensee”) is the licensing of the Index which is determined, composed and calculated by Licensor without regard to the Licensee or the Fund. Licensor has no obligation to take the needs of the Licensee or the owners of the Fund into consideration in determining, composing or calculating the Index. Licensor shall not be liable to any person for any error in the Index nor shall it be under any obligation to advise any person of any error therein.

© 2014 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.

The referenced fund is distributed by Guggenheim Funds Distributors, LLC. Guggenheim Investments represents the investment management business of Guggenheim Partners, LLC ("GP"), which includes Guggenheim Funds Investment Advisors ("GFIA"), the investment advisers to the referenced fund. Guggenheim Funds Distributors, LLC is affiliated with GP and GFIA.

 

Read a prospectus and summary prospectus (if available) carefully before investing. It contains the investment objectives, risks, charges, expenses and other information, which should be considered carefully before investing. To obtain a prospectus and summary prospectus (if available) click here or contact us.

Guggenheim Investments represents the investment management businesses of Guggenheim Partners, LLC ("Guggenheim"), which includes Security Investors, LLC ("SI"), Guggenheim Funds Investment Advisors, LLC, ("GFIA") and Guggenheim Partners Investment Management ("GPIM") the investment advisers to the referenced funds. Securities offered through Guggenheim Funds Distributors, LLC, an affiliate of Guggenheim, SI, GFIA and GPIM.

2014 Guggenheim Investments. All Rights Reserved.
• Not FDIC Insured • No Bank Guarantee • May Lose Value