Strategy. The Fund employs a passive management (or indexing) investment approach designed to track the total return performance, before fees and expenses, of the Index. The Index is based on a proprietary methodology developed and maintained by Index Design Group (IDG or the Index Provider), an affiliate of Pacer Advisors, Inc., the Funds investment adviser (the Adviser). The Index The Index uses an objective, rules-based methodology to provide exposure to large and mid-capitalization U.S. companies with high free cash flow yields. Companies with high free cash flow yields are commonly referred to as cash cows. The initial index universe is derived from the component companies of the Russell 1000 Index (excluding financial companies). Component companies of the initial universe are screened … Show more… The Fund employs a passive management (or indexing) investment approach designed to track the total return performance, before fees and expenses, of the Index. The Index is based on a proprietary methodology developed and maintained by Index Design Group (IDG or the Index Provider), an affiliate of Pacer Advisors, Inc., the Funds investment adviser (the Adviser). The Index The Index uses an objective, rules-based methodology to provide exposure to large and mid-capitalization U.S. companies with high free cash flow yields. Companies with high free cash flow yields are commonly referred to as cash cows. The initial index universe is derived from the component companies of the Russell 1000 Index (excluding financial companies). Component companies of the initial universe are screened based on their market capitalization. The equity securities of the 400 companies with the highest market capitalization are included in the Index. Companies with negative average projected free cash flows or earnings are then removed from the Index universe. Free Cash Flow (FCF): A companys cash flow from operations minus capital expenditures. Enterprise Value (EV): A companys market capitalization plus its debt and minus its cash and cash equivalents. Free Cash Flow Yield: FCF / EV The remaining companies are ranked by their free cash flow yield for the trailing twelve month period. The equity securities of the 100 companies with the highest free cash flow yield are included in the Index. At the time of each rebalance of the Index, the companies included in the Index are weighted in proportion to their trailing twelve month free cash flow, and weightings are capped at the lesser of (i) 2% or (ii) a percentage equal to 5% of a companys free float market capitalization, assuming Index market capitalization of $40 billion. The Index is reconstituted and rebalanced quarterly as of the close of business on the 3rd Friday of March, June, September, and December based on data as of the 1st Friday of the applicable rebalance month. The Funds Investment Strategy The Fund is classified as diversified under the Investment Company Act of 1940, as amended (the 1940 Act). However, the Fund may become non-diversified solely as a result of a change in the relative market capitalization or index weighting of one or more constituents of the Index. Under normal circumstances, at least 80% of the Funds net assets (plus any borrowings for investment purposes) will be invested in U.S.-listed equity securities that are the component securities of the Index. The Fund defines equity securities to mean common stocks, and may include preferred stocks, rights, warrants, and depositary receipts. The Adviser expects that, over time, the correlation between the Funds performance and that of the Index, before fees and expenses, will be 95% or better. The Fund will generally use a replication strategy to achieve its investment objective, meaning it will invest in all of the component securities of the Index in the same approximate proportion as in the Index. Show less