Strategy. The Fund employs a passive management or indexing investment approach designed to track the performance of the Index. The Vident Core International Equity Index The Index is a rules-based, systematic strategy index comprised of equity securities of issuers in developed and emerging markets outside of the United States. The strategy seeks to provide a systematic and optimized investment process that addresses the risks and opportunities of allocating capital in and among international equities. Country Allocation Index construction begins by identifying a universe of countries that are deemed to represent the bulk of investable and reliable stock opportunities in the largest and most liquid developed and emerging markets countries located outside of the United States. The Index determines a countrys investability … Show more… The Fund employs a passive management or indexing investment approach designed to track the performance of the Index. The Vident Core International Equity Index The Index is a rules-based, systematic strategy index comprised of equity securities of issuers in developed and emerging markets outside of the United States. The strategy seeks to provide a systematic and optimized investment process that addresses the risks and opportunities of allocating capital in and among international equities. Country Allocation Index construction begins by identifying a universe of countries that are deemed to represent the bulk of investable and reliable stock opportunities in the largest and most liquid developed and emerging markets countries located outside of the United States. The Index determines a countrys investability based on factors including the countrys liquidity, accessibility to foreign investors, opportunities for efficient transactions, and capital controls. The Index determines a countrys reliability based on factors including governance, regulatory oversight, market operational efficiency, legal protections for minority and foreign investors and institutional stability. While the number of countries represented in the Index may change from time to time ( e.g., at Index reconstitution or rebalance), the number of countries represented in the Index is expected to generally be between 25 and 40. Each country within the investable universe is assigned a Country Principles Score (CPS), which is calculated utilizing a proprietary scoring methodology that seeks to weigh the relative resilience of a country to economic and financial shocks and the relative attractiveness of its investment opportunities. A countrys resilience reflects the capacity of a countrys equity markets to absorb and recover from economic and financial shocks and is measured based on a variety of economic metrics related to its financial capital resources ( e.g. , the countrys deficit as a percentage of gross domestic product (GDP), physical capital resources ( e.g. , total investment as a percentage of GDP), human resources ( e.g. , productivity, GDP per capital), and institutional and organizational resources ( i.e. , measures of legal and corporate rights). A countrys investment opportunity is measured based on short- and long-term changes in the countrys business and regulatory environment and equity market valuations. Allocation across countries is based on an optimization model that seeks to maximize the Indexs overall CPS while ensuring the Index portfolio is liquid, well diversified across countries and regions, and transaction cost and turnover efficient. Stock Selection The Index employs a multi-factor model for scoring and ranking stocks listed on a securities exchange within each country in the Index universe. The model combines 20 factors into three distinct factor composites, each seeking to score different stock attributes: Component Examples Weight Valuation Price-to-book ratio, cash flow to enterprise value 50% Quality Gross profitability, return on invested capital, margin expansion, leverage, debt & equity issuance 30% Momentum Total return for past six months 20% Stocks are excluded from the Index universe if (i) they trade primarily in China, (ii) the stocks issuer is domiciled in Russia or India and does not have a depositary receipt that meets the Indexs liquidity guidelines, (iii) the stocks issuer has a market capitalization of less than US$1 billion (US$800 million for stocks already in the Index), or (iv) the stock does not meet certain minimum liquidity requirements. At the time of each reconstitution, the optimization model weights the remaining stocks to maximize the attractive factor attributes of the stocks subject to the following constraints: (i) a maximum allocation of 0.5% for any individual stock, (ii) certain liquidity thresholds, (iii) a maximum allocation of 7.5% for any individual country, and (iv) sector allocations constrained to remain close to their sector weights in a traditional market capitalization weighted index. All rules are systematized and rely on data available at the end of each rebalancing period. The Index is reconstituted and rebalanced semi-annually in January and July. As of November 25, 2025, the Index was comprised of 245 component securities and had significant exposure to the financials, consumer discretionary, industrials, and information technology sectors. The Index was created on December 31, 2014 by Vident Financial, LLC, the former parent of Vident Asset Management (Vident or the Adviser) for use by the Fund. The Adviser now also serves as the Funds index provider. The Funds Investment Strategy Under normal circumstances, at least 80% of the net assets, plus borrowings for investment purposes, of the Fund will be invested in equity securities. The Fund attempts to invest all, or substantially all, of its assets in the common stocks that make up the Index. The Fund expects to use a replication strategy to achieve its investment objective, meaning it will invest in all of the component securities of the Index, but may, when the adviser believes it is in the best interests of the Fund, 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. 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. Show less