Strategy. The Fund is an actively-managed exchange-traded fund (ETF) that blends active and passive investment strategies to optimize costs, tracking and potential return over the Funds benchmark index, the S&P Classic ADR Composite Index (the Benchmark Index). Under normal market conditions, the Fund invests at least 80% of its net assets (plus any borrowings for investment purposes) in equity securities of non-U.S. companies with varying market capitalizations. The Benchmark Index is a broad-based index that seeks to track the American depositary receipts (ADRs) trading on the New York Stock Exchange (NYSE), the NASDAQ Stock Market, LLC (NASDAQ), and over-the-counter (OTC) in the United States, subject to size and liquidity requirements. The Benchmark Index includes developed market and emerging market countries. The … Show more… The Fund is an actively-managed exchange-traded fund (ETF) that blends active and passive investment strategies to optimize costs, tracking and potential return over the Funds benchmark index, the S&P Classic ADR Composite Index (the Benchmark Index). Under normal market conditions, the Fund invests at least 80% of its net assets (plus any borrowings for investment purposes) in equity securities of non-U.S. companies with varying market capitalizations. The Benchmark Index is a broad-based index that seeks to track the American depositary receipts (ADRs) trading on the New York Stock Exchange (NYSE), the NASDAQ Stock Market, LLC (NASDAQ), and over-the-counter (OTC) in the United States, subject to size and liquidity requirements. The Benchmark Index includes developed market and emerging market countries. The sponsor of the Benchmark Index determines the composition of the Benchmark Index and relative weightings of the securities in the Benchmark Index and publishes information regarding the market value of the Benchmark Index. Neither the Fund nor the Adviser is affiliated with the sponsor of the Benchmark Index. The Benchmark Index measures the float-adjusted market capitalization weighted performance. To be eligible for Benchmark Index inclusion, a company must have a level II or III ADR program, New York Shares or Global Registered Shares listed with the NYSE or NASDAQ, or have a Level 1 ADR program traded OTC. Additionally, stocks must have been continuously trading for at least three months to be eligible for inclusion in the Benchmark Index. All stocks meeting the eligibility criteria are selected for Benchmark Index inclusion. Constituents are weighted by float-adjusted market capitalization and the index is rebalanced quarterly. The Fund may also utilize a strategic beta investment strategy for a portion of the Funds active investment allocation. The ratio of the Funds assets that are allocated to active versus passive investment strategies is determined by Envestnet Asset Management, Inc., the Funds investment adviser (the Adviser), and is based on a variety of factors, including the Advisers proprietary research that looks at the likelihood of active managers outperforming or underperforming within the asset classes in which the Fund invests, the Advisers research and due diligence on available investment sub-advisers (each, a Sub-Adviser) within the different asset classes in which the Fund invests and the Advisers assessment of how different Sub-Advisers will contribute to overall Fund performance. The Adviser also considers academic research on factor investing, which is an investment approach that involves selecting securities based on attributes associated with higher returns, and the long-term performance of factor investing with established style factors across the asset classes in which the Fund invests. Historically the Adviser has found that international developed companies are more researched and established than emerging market companies. This makes the market for international developed companies more efficient due to the availability of information and therefore, there are fewer opportunities to find market mispricings that may arise when the Adviser or a Sub-Adviser determines that a securitys price does not reflect the fundamental value of the security. The Adviser generally employs more active management in its allocations to investing in emerging markets because those companies are generally less mature and less researched and uses more passive management for investing in developed markets as they tend to be more mature and more accurately valued. The portion of the Funds investment portfolio that is actively managed by the Sub-Advisers and Adviser ranges from 30% to 80% of the Funds net assets and is expected to shift over time as economic conditions change and the available information about the asset classes in which the Fund invests evolves. The remaining portion of the Funds portfolio is allocated to the passive investment strategy. The Adviser generally rebalances the Funds portfolio between the active and passive investment strategies on an annual basis but may rebalance the portfolio more frequently if market conditions warrant or the allocation between active and passive drifts significantly from the target allocation. The Funds investment in equity securities may include common stock and preferred stock of companies that are either domiciled or have their primary operations outside the United States. The Fund may invest in companies located in non-U.S. developed markets and in companies located in emerging markets. The Adviser considers a country to be an emerging market country if companies domiciled in that country are represented in the S&P Emerging Classic ADR Index. Under normal market conditions the Fund will only invest in ADRs for exposure to securities of non-U.S. companies. The Adviser is responsible for developing, constructing and monitoring the asset allocation and portfolio strategy for the Fund and quantitatively manages the passive and strategic beta portions of the Funds investment portfolio. Quantitative investing, also known as systematic investing, is an investment approach that uses mathematical modeling, computer systems and data analysis to evaluate a specific universe of potential investments. Quantitative investing uses data to build portfolios that either attempt to track an index or provide exposure to specific investment style factors. The Advisers quantitative strategy with respect to the passive allocation of the Fund seeks to provide investment results that, before expenses, correspond to the performance of the S&P Developed Markets Classic ADR Index (the Underlying Index). The Adviser manages the passive allocation utilizing a representative sampling strategy, meaning that the Fund may not purchase all of the securities represented in the Underlying Index, but it will attempt to construct the passive allocation of the Fund to hold a portfolio of securities that, in the aggregate, have risk, return and quality characteristics that resemble the risk, return and quality characteristics of the Underlying Index. As part of the passive allocation, the Fund may invest in passively-managed ETFs in trying to construct the passive allocation to track the Underlying Index. The Underlying Index seeks to track the developed market ADRs trading on the NYSE, NASDAQ, and OTC in the United States , subject to size and liquidity requirements. The sponsor of the Underlying Index determines the composition of the Underlying Index and relative weightings of the securities in the Underlying Index and publishes information regarding the market value of the Underlying Index. Neither the Fund nor the Adviser is affiliated with the sponsor of the Underlying Index. The Underlying Index measures the float-adjusted market capitalization weighted performance. To be eligible for Underlying Index inclusion, a company must have a level II or III ADR program, New York Shares or Global Registered Shares listed with the NYSE or NASDAQ, or have a Level 1 ADR program traded OTC. Additionally, stocks must have been continuously trading for at least three months to be eligible for inclusion in the Underlying Index. All stocks meeting the eligibility criteria are selected for Underlying Index inclusion. Constituents are weighted by float-adjusted market capitalization and the Underlying Index rebalanced quarterly. Strategic beta investing involves screening the Funds investment universe for securities with specified characteristics that the Adviser believes offer opportunities for better returns. The Funds strategic beta allocation emphasizes exposure to investment style factors, including but not limited to value, momentum and quality, that academic research has linked to higher expected returns. Value investing aims to capture excess returns from stocks that have low prices relative to their fundamental value. This is commonly tracked by price to book, price to earnings, dividends, and free cash flow. Momentum investing employs the thesis that stocks that have outperformed in the past tend to exhibit strong returns for a period of time going forward. Quality investing is often captured through exposure to companies having low debt, stable earnings, consistent asset growth, and strong corporate governance. Quality stocks are identified by using common financial metrics like a return on equity, debt to equity and earnings variability. The combined active, passive and strategic beta allocations in the Funds portfolio will have similar characteristics ( e.g. , average market capitalization and region exposure) to the Benchmark Index. The Adviser also believes that the Funds reward and risk characteristics can be enhanced by employing one or more Sub-Advisers, with complementary styles and approaches, who actively manage distinct segments of a market, asset class or investment style for the Fund. The Fund currently employs two Sub-Advisers to manage the Funds qualitative active allocation, Causeway Capital Management LLC (Causeway) and Lazard Asset Management LLC (Lazard). Causeway utilizes an international value ADR strategy that seeks long-term growth of capital by utilizing a value investing style, which targets stocks that Causeway believes are trading at a lower price than their true value. Typical value characteristics Causeway considers in evaluating investments for the Fund include low price-to-earnings ratio relative to the sector, high yield relative to the market, low price-to-book value ratio relative to the market, low price-to-cash flow ratio relative to the market, and financial strength. Causeway generally invests in companies with market capitalizations of U.S. $5 billion or greater at the time of investment. Lazard utilizes its international quality growth ADR strategy. The strategy invests primarily in American Depository Receipts (ADRs) of non-U.S. companies, including those whose principal business activities are located in emerging market countries that Lazard considers to be quality growth businesses. By quality Lazard means businesses that it believes can generate, and sustain, high levels of financial productivity ( i.e. , return on equity, return on capital and cash flow return on investment). Lazard considers, among other factors deemed appropriate and relevant to a particular company, whether the company has a competitive advantage in its industry and if Lazard believes the company can sustain its competitive advantage. Lazard also looks for growth businesses that it believes can grow profits and cash flows by investing back into their business at similarly high rates of financial productivity. Lazard may invest its allocation in securities of companies across the capitalization spectrum, but generally focuses on companies with a market capitalization of $3 billion or greater at the time of investment. The Sub-Advisers generally rely on detailed proprietary research and actively focus on the sectors and securities they believe are undervalued relative to the market. The Sub-Advisers will actively trade the portion of the Funds investment portfolio they manage, and the Fund may experience a high portfolio turnover rate. In selecting securities for investment, the Sub-Advisers typically: Use in-depth fundamental research to identify sectors and securities for potential investment and to analyze risk; Exploit inefficiencies in the valuation of risk and reward; Look to capitalize on rapidly shifting market risks and dynamics caused by economic and technical factors; and Consider the liquidity of securities and the portfolio overall as an important factor in portfolio construction. Show less