Strategy. The Fund uses a passive management (or indexing) approach to track the performance, before fees and expenses, of the Index. The Index was developed in 2018 by Loncar Investments LLC, the Funds index provider (Loncar or the Index Provider), and seeks to track the performance of a modified equal-weighted portfolio of companies directly involved in the growth of Chinas pharmaceutical and biotech related industries (Chinas biopharma sector). The Index includes pharmaceutical companies, biotech companies, drug manufacturers, diagnostics companies, wholesalers or distributors of biopharma products, and biopharma service providers (Biopharma Companies). Loncar China BioPharma Index The Index is constructed from the universe of Nasdaq- or Hong Kong Stock Exchange-listed companies identified by the Index methodology as Biopharma Companies. To maintain a … Show more… The Fund uses a passive management (or indexing) approach to track the performance, before fees and expenses, of the Index. The Index was developed in 2018 by Loncar Investments LLC, the Funds index provider (Loncar or the Index Provider), and seeks to track the performance of a modified equal-weighted portfolio of companies directly involved in the growth of Chinas pharmaceutical and biotech related industries (Chinas biopharma sector). The Index includes pharmaceutical companies, biotech companies, drug manufacturers, diagnostics companies, wholesalers or distributors of biopharma products, and biopharma service providers (Biopharma Companies). Loncar China BioPharma Index The Index is constructed from the universe of Nasdaq- or Hong Kong Stock Exchange-listed companies identified by the Index methodology as Biopharma Companies. To maintain a focus on innovation in the Chinese biopharma sector, companies in the Index universe are screened to eliminate those that focus strictly on manufacturing active pharmaceutical ingredients. The remaining companies are then screened according to the Index rules to include only companies (i) whose principal corporate headquarters is in China or (ii) for which at least 51% of the value of their product revenue and pipeline is tied directly to the Chinese market (such remaining companies, China Biopharma Companies). The pool of China Biopharma Companies is then screened for investibility leaving only companies having a market capitalization of at least USD$200 million, meeting a minimum liquidity threshold, and that are not publicly known to currently be under formal investigation by a government or regulatory entity. At the time of each reconstitution of the Index on the second Monday of each February and August, each constituent is weighted equally, subject to the following adjustments applied depending on a companys market capitalization to emphasize the role of larger companies in the Index: Market Capitalization (USD$) Weight Adjustment Factor $10 billion or more 140% Between $1 billion and $10 billion 100% From $200 million to $1 billion 70% As of November 15, 2022, the Index contained 60 companies, 9 of which were listed on Nasdaq and 51 of which were listed on the Hong Kong Stock Exchange. As of November 15, 2022, the three largest components of the Index were CanSino Biologics, Inc. (3.26%), Keymed Biosciences, Inc. (3.00%), and CSPC Pharmaceutical Group Ltd. (2.99%). The Funds Investment Strategy The Fund attempts to invest all, or substantially all, of its assets in the component securities and depositary receipts that make up the Index. Exchange Traded Concepts, LLC (ETC or the Adviser), the Funds investment 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 generally will invest in all of the component securities of the Index in approximately the same proportion as in the Index. However, the Fund may use a representative sampling strategy, meaning it may invest in a sample of the securities in the Index whose risk, return, and other characteristics closely resemble the risk, return, and other characteristics of the Index as a whole, when the Funds sub-adviser believes it is in the best interests of the Fund ( e.g. , when replicating the Index involves practical difficulties or substantial costs, an Index constituent becomes temporarily illiquid, unavailable or less liquid, or as a result of legal restrictions or limitations that apply to the Fund but not to the Index). The Fund generally may invest in securities or other investments not included in the Index, but which the Funds sub-adviser believes will help the Fund track the Index. For example, the Fund may invest in securities that are not components of the Index to reflect various corporate actions and other changes to the Index (such as reconstitutions, additions and deletions). To the extent the Index concentrates ( i.e. , holds more than 25% of its total assets) in the securities of a particular industry or group of related industries, the Fund will concentrate its investments to approximately the same extent as the Index. The Adviser expects that the Index, and consequently the Fund, will generally be concentrated in the securities of biotech and pharmaceutical companies. Show less