ETF Series Solutions
05/08/2024 | Press release | Distributed by Public on 05/08/2024 15:28
Semi-Annual Report by Investment Company - Form N-CSRS
As filed with the U.S. Securities and Exchange Commission on May 8, 2024
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-22668
ETF Series Solutions
(Exact name of registrant as specified in charter)
615 East Michigan Street
Milwaukee, WI 53202
(Address of principal executive offices) (Zip code)
Kristina R. Nelson
ETF Series Solutions
615 East Michigan Street
Milwaukee, WI 53202
(Name and address of agent for service)
(414) 516-1645
Registrant's telephone number, including area code
Date of fiscal year end: August 31
Date of reporting period: February 29, 2024
Item 1. Reports to Stockholders.
| (a) |
Semi-Annual Report
February 29, 2024
Vident International Equity Strategy ETFTM
Ticker: VIDI
Vident U.S. Equity Strategy ETFTM
Ticker: VUSE
Vident U.S. Bond Strategy ETFTM
Ticker: VBND
Vident ETFs
TABLE OF CONTENTS
|
Page |
|
|
Letters to Shareholders |
1 |
|
Portfolio Allocations |
8 |
|
Schedules of Investments |
11 |
|
Statements of Assets and Liabilities |
38 |
|
Statements of Operations |
40 |
|
Statements of Changes in Net Assets |
41 |
|
Financial Highlights |
44 |
|
Notes to Financial Statements |
50 |
|
Expense Examples |
65 |
|
Review of Liquidity Risk Management Program |
67 |
|
Federal Tax Information |
68 |
|
Information About Portfolio Holdings |
69 |
|
Information About Proxy Voting |
70 |
|
Information About the Funds' Trustees |
70 |
|
Frequency Distribution of Premiums and Discounts |
70 |
Vident International Equity Strategy ETFTM
Letters to Shareholders
February 29, 2024 (Unaudited)
Dear Shareholders,
On behalf of the entire team, we want to express our appreciation for the confidence you have placed in the Vident International Equity Strategy ETF™ ("VIDI" or the "Fund"). The following information pertains to the fiscal period of September 1, 2023 through February 29, 2024 (the "period"). The Fund seeks to track the total return performance, before fees and expenses, of the Vident Core International Equity Index™ (the "Index"). This index strategy seeks to provide investors with a well-diversified set of global equities exposures across countries, regions and stocks, emphasizing countries with more favorable conditions for investment as well as economic and financial market resilience. The Index also seeks to enhance investors' stock exposures, systematically selecting higher quality stocks that Vident believes to have favorable valuations and favorable price momentum.
The Fund had positive performance during the period ending on February 29, 2024. The market return for VIDI was 7.58% and the NAV return was 7.04%, while the Morningstar Global Markets ex-US Large-Mid Cap Index, a broad market index, increased 7.78% over the same period. The Fund's Index increased 7.65%. Meanwhile, outstanding shares ended the period at 15,600,000.
VIDI returns were consistent with global market dynamics. Most global markets underperformed U.S. markets, and VIDI (an international fund) underperformed most U.S. indices. The exchange rate for the U.S. dollar ended roughly at the same rate as it was at the beginning of the period, so currency dynamics are not likely the problem. Emerging markets underperformed developed markets. Accordingly, VIDI (which is overweight emerging markets) underperformed Morningstar Global Markets ex-US Large-Mid Cap Index (which is overweight developed markets). VIDI was underweight developed Asia, an overperforming region, which may also help explain why VIDI slightly lagged Morningstar Global Markets ex-US Large-Mid Cap Index. Expectations of a tighter U.S. Federal Reserve may have contributed to the headwind for emerging markets as interest rate hikes historically have disproportionately harmed emerging markets.
For the period, the largest positive contributor to return was Chicony Electronics Co., Ltd. (2385 TT), adding 0.41% to the return of the Fund, gaining 82.76% with an average weighting of 0.70%. The second largest contributor to return was Compeq Manufacturing Co., Ltd. (2313 TT), adding 0.34% to the return of the Fund, gaining 69.48% with an average weighting of 0.66%. The third largest contributor to return was Bank Polska Kasa Opieki Spolka Akcyjna (PEO PW), adding 0.31% to the return of the Fund, gaining 65.78% with an average weighting of 0.57%.
1
Vident International Equity Strategy ETFTM
LetterS to Shareholders
February 29, 2024 (Unaudited) (Continued)
For the period, the largest negative contributor to return was InMode Ltd. (INMD US), detracting 0.22% from the return of the Fund, declining 43.72% with an average weighting of 0.29%. The second largest negative contributor was Nongshim Co., Ltd. (004370 KS), detracting 0.14% from the return of the Fund, and declining 23.72% with an average weighting of 0.53%. The third largest negative contributor to return was BioNTech SE (BNTX US), detracting 0.13% from the return of the Fund, and declining 21.41% with an average weight of 0.42%.
For the period, the best performing security in the Fund was Chicony Electronics Co., Ltd. (2385 TT), gaining 82.76% and contributing 0.41% to the return of the Fund. The second-best performing security for the period was Celestica Inc. (CLS CN), gaining 82.69% and contributing 0.23% to the return of the Fund. The third-best performing security was Compeq Manufacturing Co., Ltd. (2313 TT), gaining 69.48% for the period and contributing 0.34% to the return of the Fund.
For the period, the worst performing security in the Fund was InMode Ltd. (INMD US), declining 43.72% and reducing the return of the Fund by 0.22%. The second-worst performing security in the Fund was Hello Group Inc. (MOMO US), declining 31.98% and reducing the return of the Fund by 0.10%. The third-worst performing security in the Fund was Perion Network Ltd (PERI US), declining 30.85% and reducing the return of the Fund by 0.12%.
Sincerely,
Vince Birley
Chief Executive Officer, Vident Asset Management
2
Vident U.S. Equity Strategy ETFTM
LetterS to Shareholders
February 29, 2024 (Unaudited)
Dear Shareholders,
On behalf of the entire team, we want to express our appreciation for the confidence you have placed in the Vident U.S. Equity Strategy ETF™ ("VUSE" or the "Fund"). The following information pertains to the fiscal period of September 1, 2023 through February 29, 2024 (the "period"). The Fund seeks to track the total return performance, before fees and expenses, of the Vident U.S. Quality Index™ (the "Index"). This index strategy represents a portfolio of U.S. equities that adhere to higher standards of corporate governance and accounting, as measured by numerous research metrics. This research is integrated into a systematic and structured selection process that seeks to provide an index of higher quality U.S. companies across small, medium and large-capitalization ranges. The Index also seeks to mitigate some of the risks often associated with market capitalization-weighted indices, including issuer concentration.
The Fund had positive performance during the period ending on February 29, 2024. The market return for VUSE was 11.09% and the NAV return was 10.63%, while the S&P 500 Index, a broad market index, increased 13.93% over the same period. The Fund's Index increased 10.95%. Meanwhile, outstanding shares ended the period at 10,625,000.
The positive performance of VUSE, similar to most of the public equity asset class, is consistent with the economic and market themes of the period. The economy continued its recovery, and that reflected itself in profit growth. VUSE also underweights giant cap relative to the S&P Index, which meant that it participated less in the valuation expansion of companies associated with the artificial intelligence (AI) trend. VUSE is slightly overweight to small and mid-capitalization, and those capitalization sizes underperformed during the period. VUSE's market return makes sense in light of the dynamics of other markets during the period covered by this report.
For the period, the largest positive contributor to return was Broadcom Inc. (AVGO US), adding 0.87% to the return of the Fund, gaining 42.35% with an average weighting of 2.18%. The second largest contributor to return was Microsoft Corporation (MSFT US), adding 0.70% to the return of the Fund, gaining 26.69% with an average weighting of 2.73%. The third largest contributor to return was Meta Platforms, Inc. (META US), adding 0.57% to the return of the Fund, gaining 65.82% with an average weighting of 1.00%.
For the period, the largest negative contributor to return was Tesla, Inc. (TSLA US), detracting 0.33% from the return of the Fund, declining 21.78% with an average weighting of 1.28%. The second largest negative contributor was Cisco Systems, Inc. (CSCO US), detracting 0.31% from the return of the Fund, and declining 14.39% with
3
Vident U.S. Equity Strategy ETFTM
LetterS to Shareholders
February 29, 2024 (Unaudited) (Continued)
an average weighting of 1.79%. The third largest negative contributor to return was Iridium Communications Inc. (IRDM US), detracting 0.24% from the return of the Fund, and declining 40.51% with an average weight of 0.46%.
For the period, the best performing security in the Fund was Alpha Metallurgical Resources, Inc. (AMR US), gaining 86.70% and contributing 0.40% to the return of the Fund. The second-best performing security for the period was Vistra Corp. (VST US), gaining 75.65% and contributing 0.39% to the return of the Fund. The third-best performing security was Meta Platforms, Inc. (META US), gaining 65.82% for the period and contributing 0.57% to the return of the Fund.
For the period, the worst performing security in the Fund was Iridium Communications Inc. (IRDM US), declining 40.51% and reducing the return of the Fund by 0.24%. The second-worst performing security in the Fund was Charter Communications, Inc. (CHTR US), declining 32.91% and reducing the return of the Fund by 0.24%. The third-worst performing security in the Fund was Cross Country Healthcare, Inc. (CCRN US), declining 29.08% and reducing the return of the Fund by 0.16%.
Sincerely,
Vince Birley
Chief Executive Officer, Vident Asset Management
4
Vident U.S. Bond Strategy ETFTM
LetterS to Shareholders
February 29, 2024 (Unaudited)
Dear Shareholders,
On behalf of the entire team, we want to express our appreciation for the confidence you have placed in the Vident U.S. Bond Strategy ETF™ ("VBND" or the "Fund"). The following information pertains to the fiscal period of September 1, 2023 through February 29, 2024 (the "period"). The Fund seeks to track the total return performance, before fees and expenses, of the Vident Core U.S. Bond Index™ (the "Index"). This Index seeks to diversify interest rate and credit risks through the application of time-tested principles. In addition to diversifying across fixed income sectors, the strategy seeks to improve corporate bond exposures by screening for companies with stronger leadership, governance and creditworthiness factors.
The Fund had positive performance during the period ending on February 29, 2024. The market return for VBND was 4.17% and the NAV return was 3.99%, while the FTSE US Broad Investment Grade Bond Index, a broad market index, returned 2.40% over the same period. The Fund's Index returned 4.46%. Meanwhile, outstanding shares ended the period at 9,500,000.
Due to its fixed income composition, VBND is sensitive to U.S. Federal Reserve ("Fed") policy. Buying and selling U.S. Treasury securities, which is a core holding for VBND, is a significant aspect of Fed policy implementation. During the six-month period ending February 29, 2024, the futures market indicated a rising probability that the Fed would stand pat as opposed to cutting rates. VBND's underperformance relative to most equity indices is consistent with general bond market returns relative to equities, and with the shift in market expectations towards a more hawkish Fed. Additionally, not just negative relative performance but also negative market returns are consistent with the hawkish sentiment shift during the period. VBND's favorable performance relative to the FTSE US Broad Investment Grade Bond Index makes sense: VBND was underweight to mortgages which have tended to underperform, and also was more weighted to high quality corporate bonds with higher yields than the rest of the sector. With regard to Treasuries, duration likely helped as well, as VBND had shorter duration in treasuries, and short duration treasuries outperformed long duration treasuries. Hawkish sentiment helps explain both general bond losses and VBNDs performance relative to broad bond indices.
For the period, the largest positive contributor to return was United States Treasury (T 0 ¼ 08/31/25), adding 0.13% to the return of the Fund, gaining 2.53% with an average weighting of 4.97%. The second largest contributor to return was United States Treasury (T 3 05/15/42), adding 0.13% to the return of the Fund, gaining 11.91% with an average weighting of 0.67%. The third largest contributor to return was United States Treasury (T 6 02/15/26), adding 0.12% to the return of the Fund, gaining 2.59% with an average weighting of 3.05%.
5
Vident U.S. Bond Strategy ETFTM
LetterS to Shareholders
February 29, 2024 (Unaudited) (Continued)
For the period, the largest negative contributor to return was Ginnie Mae (G2SF 5.5 10/23), detracting 0.04% from the return of the Fund, declining 3.45% with an average weighting of 0.21%. The second largest negative contributor was Ginnie Mae (G2SF 6 10/23), detracting 0.04% from the return of the Fund, and declining 2.59% with an average weighting of 0.27%. The third largest negative contributor was United States Treasury (T 1 ¼ 05/15/50), detracting 0.03% from the return of the Fund, and declining 15.40% with an average weight of 0.07%.
For the period, the best performing security in the Fund was M.D.C. Holdings, Inc. (MDC 6 01/15/43), gaining 18.67% and contributing 0.06% to the return of the Fund. The second-best performing security for the period was Sempra (SRE 4 ⅛ 04/01/52), gaining 16.01% and contributing 0.05% to the return of the Fund. The third-best performing security was Enstar Finance LLC (ESGR 5 ½ 01/15/42), gaining 16.00% for the period and contributing 0.05% to the return of the Fund.
For the period, the worst performing security in the Fund was United States Treasury (T 1 ¼ 05/15/50), declining 15.40% and reducing the return of the Fund by 0.03%. The second-worst performing security in the Fund was FMC Corporation (FMC 6 ⅜ 05/18/53), declining 11.24% and reducing the return of the Fund by 0.03%. The third-worst performing security in the Fund was WarnerMedia Holdings, Inc. (WBD 5.391 03/15/62), declining 5.95% and reducing the return of the Fund by 0.02%.
Sincerely,
Vince Birley
Chief Executive Officer, Vident Asset Management
Past performance is no guarantee of future results.
Opinions expressed are subject to change, are not guaranteed and should not be considered investment advice or recommendations to buy or sell any security. Fund holdings are subject to change and are not recommendations to buy or sell any security. For more complete information regarding performance and holdings, please refer to the schedules of investments on pages 11-37.
Investments involve risk. Principal loss is possible. The Funds have the same risks as the underlying securities traded on the exchange throughout the day at market price. Redemptions are limited and often commissions are charged on each trade. Investments in foreign securities involve political, economic and currency risks, greater volatility and differences in accounting methods. These risks are greater for investments in emerging markets. A fund that concentrates its investments in the securities of a particular industry or geographic area may be more volatile than a fund that invests in a broader range of industries. VIDI and VBND may invest in illiquid or thinly traded securities which involve additional risks such as limited liquidity and greater volatility. VBND may make investments in debt securities. The Fund's investments in high yield securities expose it to a substantial degree of credit risk. These investments are considered speculative under traditional investment standards. Debt issuers and other counterparties may not honor their obligations or may have their debt downgraded by ratings agencies. An increase in interest rates may cause the value of fixed-income securities held by the Fund to decline. During periods of rising interest rates, certain debt obligations will be paid off substantially more slowly than originally anticipated and the value of those securities may fall sharply, resulting in a decline in the Fund's income and potentially in the value of the Fund's investments. VBND may also invest in asset backed and mortgage backed securities which include additional risks that investors
6
Vident U.S. Bond Strategy ETFTM
LetterS to Shareholders
February 29, 2024 (Unaudited) (Continued)
should be aware of such as credit risk, prepayment risk, possible illiquidity and default, as well as increased susceptibility to adverse economic developments. The performance of the Funds may diverge from that of the Indices. Because the Funds employ a representative sampling strategy and may also invest up to 20% of their assets in securities that are not included in the Indices, the Funds may experience tracking error to a greater extent than a fund that seeks to replicate an index. The Funds are not actively managed and may be affected by a general decline in market segments related to the Indices. The Funds invest in securities included in, or representative of securities included in, the Indices, regardless of their investment merits. Small and medium-capitalization companies tend to have more limited liquidity and greater price volatility than large-capitalization companies. Unlike mutual funds, ETFs may trade at a premium or discount to their net asset value.
The Vident Core International Equity Index™ (Bloomberg Symbol: VIEQX) is a strategy seeking to balance risk across developed and emerging countries and emphasize those with favorable conditions for growth. The Vident U.S. Quality Index™ (Bloomberg Symbol: VQUSX) is a strategy which seeks to seeks to maximize exposure to a proprietary "Quality Composite Score" in a diversified manner across three separate market capitalization segments: giant, large, and small- and mid-capitalization. The Vident Core U.S. Bond Index™ (Bloomberg Symbol: VUBDX) is a strategy which seeks to diversify and improve interest rate and credit risks of traditional U.S. core bonds.
The Morningstar Global ex-US Large-Mid Index measures the performance of Global Markets Ex-US equity markets targeting the top 90% of stocks by market capitalization. This Index does not incorporate Environmental, Social, or Governance (ESG) criteria.
The Morningstar Global Markets ex-US Index measures the performance of the stocks located in the developed and emerging countries across the world (excluding the United States) as defined by Morningstar. Stocks in the index are weighted by their float capital, which removes corporate cross ownership, government holdings and other locked-in shares. This Index does not incorporate Environmental, Social, or Governance (ESG) criteria.
The S&P 500 Index measures the performance of 500 widely held stocks in US equity market. Standard and Poor's chooses member companies for the index based on market size, liquidity and industry group representation. Included are the stocks of industrial, financial, utility, and transportation companies. Since mid-1989, this composition has been more flexible and the number of issues in each sector has varied. It is market capitalization-weighted.
The Morningstar U.S. Market Total Return Index measures the performance of US securities and targets 97% market capitalization coverage of the investable universe. It is a diversified broad market index. This Index does not incorporate Environmental, Social, or Governance (ESG) criteria.
The FTSE Broad Investment Grade Bond Index measures the performance of US Dollar-denominated bonds issued in the US investment-grade bond market. Introduced in 1985, the index covers US Treasury, government sponsored, collateralized, and corporate debt providing a reliable representation of the US investment-grade bond market. Subindexes are available in any combination of asset class, maturity, and rating.
It is not possible to invest directly in an index.
Diversification does not assure a profit or protect against loss in a declining market.
Must be preceded or accompanied by a Prospectus.
7
Vident International Equity Strategy ETFTM
Portfolio Allocations
As of February 29, 2024 (Unaudited)
|
Country |
Percentage of |
|
Republic of Korea |
8.0% |
|
Taiwan |
7.6 |
|
Singapore |
6.7 |
|
Hong Kong |
6.1 |
|
Canada |
6.0 |
|
China |
5.2 |
|
Germany |
5.1 |
|
Norway |
4.8 |
|
Switzerland |
4.6 |
|
United Kingdom |
4.1 |
|
Sweden |
3.8 |
|
Brazil |
3.7 |
|
Israel |
3.7 |
|
Australia |
3.5 |
|
Denmark |
3.0 |
|
Poland |
2.7 |
|
Netherlands |
2.7 |
|
Indonesia |
2.6 |
|
Mexico |
2.3 |
|
Malaysia |
2.3 |
|
Chile |
1.9 |
|
France |
1.7 |
|
Spain |
1.2 |
|
South Africa |
1.1 |
|
Finland |
1.0 |
|
Japan |
0.8 |
|
Italy |
0.7 |
|
Belgium |
0.5 |
|
Thailand |
0.5 |
|
Portugal |
0.5 |
|
Ireland |
0.3 |
|
Austria |
0.2 |
|
Russian Federation |
0.0 |
|
Short-Term Investments |
0.5 |
|
Other Assets in Excess of Liabilities |
0.6 |
|
Total |
100.0% |
8
Vident U.S. Equity Strategy ETFTM
Portfolio Allocations
As of February 29, 2024 (Unaudited) (Continued)
|
Sector |
Percentage of |
|
Information Technology (a) |
26.4% |
|
Financials |
13.9 |
|
Consumer Discretionary |
12.4 |
|
Industrials |
11.4 |
|
Health Care |
11.1 |
|
Communication Services |
7.8 |
|
Consumer Staples |
6.9 |
|
Energy |
4.7 |
|
Materials |
2.2 |
|
Real Estate |
1.7 |
|
Utilities |
1.2 |
|
Short-Term Investments |
0.2 |
|
Other Assets in Excess of Liabilities |
0.1 |
|
Total |
100.0% |
|
(a) |
To the extent that the Fund invests more heavily in particular sectors of the economy, its performance will be especially sensitive to developments that significantly affect those sectors. See Note 7 in Notes to Financial Statements. |
9
Vident U.S. Bond Strategy ETFTM
Portfolio Allocations
As of February 29, 2024 (Unaudited) (Continued)
|
Asset Type |
Percentage of |
|
U.S. Government Notes/Bonds |
61.5% |
|
Corporate Bonds |
24.6 |
|
Mortgage Backed Securities - U.S. Government Agency |
9.9 |
|
U.S. Government Agency Issues |
3.0 |
|
Short-Term Investments |
7.6 |
|
Liabilities in Excess of Other Assets |
(6.6) |
|
Total |
100.0% |
10
Vident International Equity Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited)
|
Shares |
Security Description |
Value |
||||||
|
COMMON STOCKS - 97.5% |
||||||||
|
Australia - 3.5% |
||||||||
| 119,908 |
BlueScope Steel, Ltd. |
$ | 1,783,309 | |||||
| 96,562 |
Fortescue, Ltd. |
1,630,388 | ||||||
| 48,702 |
JB Hi-Fi, Ltd. |
1,952,215 | ||||||
| 327,202 |
New Hope Corporation, Ltd. |
1,001,374 | ||||||
| 510,478 |
Qantas Airways, Ltd. (a) |
1,705,205 | ||||||
| 43,981 |
Sonic Healthcare, Ltd. |
854,854 | ||||||
| 100,077 |
Super Retail Group, Ltd. |
1,062,846 | ||||||
| 949,392 |
Tabcorp Holdings, Ltd. |
463,649 | ||||||
| 343,666 |
Whitehaven Coal, Ltd. |
1,548,549 | ||||||
| 371,538 |
Yancoal Australia, Ltd. |
1,439,470 | ||||||
| 13,441,859 | ||||||||
|
Austria - 0.2% |
||||||||
| 3,962 |
OMV AG |
174,671 | ||||||
| 19,919 |
voestalpine AG |
544,055 | ||||||
| 718,726 | ||||||||
|
Belgium - 0.5% |
||||||||
| 50,493 |
Proximus SADP |
422,482 | ||||||
| 66,404 |
Solvay SA - Class A |
1,688,682 | ||||||
| 2,111,164 | ||||||||
|
Brazil - 2.9% |
||||||||
| 408,124 |
Cia de Saneamento de Minas Gerais Copasa MG |
1,701,937 | ||||||
| 673,159 |
Marfrig Global Foods SA (a) |
1,325,007 | ||||||
| 140,126 |
Pagseguro Digital, Ltd. - Class A (a) |
1,950,554 | ||||||
| 178,619 |
Telefonica Brasil SA |
1,962,107 | ||||||
| 521,272 |
TIM SA |
1,901,009 | ||||||
| 388,395 |
Vibra Energia SA |
2,005,038 | ||||||
| 10,845,652 | ||||||||
|
Canada - 6.0% |
||||||||
| 45,505 |
Air Canada (a) |
607,919 | ||||||
| 17,766 |
Alimentation Couche-Tard, Inc. |
1,102,491 | ||||||
| 46,251 |
Celestica, Inc. (a) |
1,966,865 | ||||||
| 60,431 |
Empire Company, Ltd. - Class A |
1,532,217 | ||||||
| 1,860 |
Fairfax Financial Holdings, Ltd. |
1,986,491 | ||||||
| 14,341 |
George Weston, Ltd. |
1,879,497 | ||||||
| 31,726 |
Great-West Lifeco, Inc. |
977,732 |
The accompanying notes are an integral part of these financial statements.
11
Vident International Equity Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Shares |
Security Description |
Value |
||||||
|
COMMON STOCKS - 97.5% (Continued) |
||||||||
|
Canada - 6.0% (Continued) |
||||||||
| 27,069 |
iA Financial Corporation, Inc. |
$ | 1,679,601 | |||||
| 18,527 |
Loblaw Companies, Ltd. |
1,975,703 | ||||||
| 28,690 |
Magna International, Inc. |
1,581,773 | ||||||
| 84,179 |
Manulife Financial Corporation |
1,999,046 | ||||||
| 56,181 |
Parex Resources, Inc. |
907,114 | ||||||
| 20,650 |
Stelco Holdings, Inc. |
614,316 | ||||||
| 35,231 |
Sun Life Financial, Inc. |
1,872,268 | ||||||
| 57,118 |
Suncor Energy, Inc. |
1,963,662 | ||||||
| 22,646,695 | ||||||||
|
Chile - 1.4% |
||||||||
| 1,065,595 |
Cencosud SA |
1,911,870 | ||||||
| 13,637,528 |
Enel Americas SA |
1,389,117 | ||||||
| 150,521,181 |
Latam Airlines Group SA (a) |
1,891,214 | ||||||
| 5,192,201 | ||||||||
|
China - 5.2% |
||||||||
| 2,379,000 |
3SBio, Inc. (c) |
1,571,049 | ||||||
| 710,500 |
AAC Technologies Holdings, Inc. |
1,766,085 | ||||||
| 1,679,000 |
China Coal Energy Company, Ltd. - H Shares |
1,812,225 | ||||||
| 2,856,000 |
China Resources Pharmaceutical Group, Ltd. (c) |
1,933,476 | ||||||
| 1,717,500 |
COSCO SHIPPING Holdings Company, Ltd. - H-Shares |
1,851,587 | ||||||
| 1,404,000 |
Lenovo Group, Ltd. |
1,554,859 | ||||||
| 5,124,000 |
People's Insurance Company Group of China, Ltd. - H-Shares |
1,708,262 | ||||||
| 1,448,000 |
PICC Property & Casualty Company, Ltd. - H-Shares |
1,982,751 | ||||||
| 591,200 |
Sinopharm Group Company, Ltd. - H-Shares |
1,657,577 | ||||||
| 1,047,600 |
Xiaomi Corporation - Class B (a)(c) |
1,769,016 | ||||||
| 1,487,400 |
Yangzijiang Shipbuilding Holdings, Ltd. |
1,935,855 | ||||||
| 19,542,742 | ||||||||
|
Denmark - 3.0% |
||||||||
| 965 |
AP Moller - Maersk AS - Class B |
1,365,343 | ||||||
| 37,237 |
Bavarian Nordic AS (a) |
844,391 | ||||||
| 34,436 |
D/S Norden AS |
1,548,753 | ||||||
| 35,276 |
Demant AS (a) |
1,767,308 | ||||||
| 363,108 |
H Lundbeck AS (a) |
1,759,584 |
The accompanying notes are an integral part of these financial statements.
12
Vident International Equity Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Shares |
Security Description |
Value |
||||||
|
COMMON STOCKS - 97.5% (Continued) |
||||||||
|
Denmark - 3.0% (Continued) |
||||||||
| 26,053 |
NKT AS (a) |
$ | 1,959,185 | |||||
| 12,622 |
Pandora AS |
2,039,442 | ||||||
| 11,284,006 | ||||||||
|
Finland - 1.0% |
||||||||
| 134,757 |
Fortum OYJ |
1,684,298 | ||||||
| 95,781 |
Nokia OYJ |
337,844 | ||||||
| 179,911 |
Outokumpu OYJ |
796,866 | ||||||
| 25,178 |
UPM-Kymmene OYJ |
842,727 | ||||||
| 3,661,735 | ||||||||
|
France - 1.7% |
||||||||
| 18,439 |
Bouygues SA |
729,706 | ||||||
| 26,797 |
Cie de Saint-Gobain SA |
2,064,676 | ||||||
| 54,590 |
Cie Generale des Etablissements Michelin SCA |
2,019,752 | ||||||
| 34,819 |
STMicroelectronics NV |
1,572,166 | ||||||
| 6,386,300 | ||||||||
|
Germany - 5.0% |
||||||||
| 6,963 |
Aurubis AG |
441,399 | ||||||
| 18,144 |
Bayerische Motoren Werke AG |
2,144,475 | ||||||
| 140,725 |
Deutsche Bank AG |
1,882,547 | ||||||
| 218,672 |
Deutsche Lufthansa AG (a) |
1,700,932 | ||||||
| 73,132 |
Deutsche Telekom AG |
1,739,881 | ||||||
| 113,031 |
E.ON SE |
1,444,552 | ||||||
| 28,541 |
Freenet AG |
770,285 | ||||||
| 35,430 |
Fresenius Medical Care AG & Company KGaA |
1,356,484 | ||||||
| 63,908 |
Fresenius SE & Company KGaA |
1,789,803 | ||||||
| 20,320 |
Heidelberg Materials AG |
1,972,431 | ||||||
| 100,475 |
K+S AG |
1,402,599 | ||||||
| 12,575 |
Mercedes-Benz Group AG |
1,002,092 | ||||||
| 21,968 |
Suedzucker AG |
310,945 | ||||||
| 15,335 |
Talanx AG |
1,095,251 | ||||||
| 19,053,676 | ||||||||
|
Hong Kong - 6.1% |
||||||||
| 3,056,000 |
Bosideng International Holdings, Ltd. |
1,541,897 | ||||||
| 1,217,400 |
China Taiping Insurance Holdings Company, Ltd. |
1,062,084 | ||||||
| 3,884,000 |
China Traditional Chinese Medicine Holdings Company, Ltd. |
2,143,225 |
The accompanying notes are an integral part of these financial statements.
13
Vident International Equity Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Shares |
Security Description |
Value |
||||||
|
COMMON STOCKS - 97.5% (Continued) |
||||||||
|
Hong Kong - 6.1% (Continued) |
||||||||
| 13,453,000 |
GCL Technology Holdings, Ltd. |
$ | 1,873,055 | |||||
| 1,812,000 |
Geely Automobile Holdings Ltd. |
1,981,239 | ||||||
| 942,000 |
Kingboard Holdings, Ltd. |
1,850,598 | ||||||
| 2,058,000 |
Kunlun Energy Company, Ltd. |
1,758,637 | ||||||
| 121,500 |
Orient Overseas International, Ltd. |
1,888,738 | ||||||
| 5,900,000 |
Pacific Basin Shipping, Ltd. |
1,725,807 | ||||||
| 4,896,000 |
Sino Biopharmaceutical Ltd. |
1,957,449 | ||||||
| 1,478,000 |
Sino Land Company, Ltd. |
1,595,276 | ||||||
| 1,153,000 |
SITC International Holdings Company, Ltd. |
1,896,924 | ||||||
| 2,968,500 |
WH Group, Ltd. (c) |
1,789,715 | ||||||
| 23,064,644 | ||||||||
|
Indonesia - 2.6% |
||||||||
| 12,346,500 |
Adaro Energy Indonesia Tbk PT |
1,901,275 | ||||||
| 5,769,800 |
Astra International Tbk PT |
1,918,371 | ||||||
| 4,643,400 |
Bank Mandiri Persero Tbk PT |
2,068,330 | ||||||
| 5,396,000 |
Bank Negara Indonesia Persero Tbk PT |
2,060,197 | ||||||
| 1,260,000 |
United Tractors Tbk PT |
1,886,191 | ||||||
| 9,834,364 | ||||||||
|
Ireland - 0.3% |
||||||||
| 2,440 |
CRH plc (a) |
205,716 | ||||||
| 14,124 |
DCC plc |
1,003,357 | ||||||
| 1,209,073 | ||||||||
|
Israel - 3.7% |
||||||||
| 97,766 |
Bank Hapoalim BM |
935,615 | ||||||
| 1,234,940 |
Bezeq The Israeli Telecommunication Corporation, Ltd. |
1,667,632 | ||||||
| 15,032 |
Delek Group, Ltd. |
2,026,517 | ||||||
| 281,766 |
ICL Group, Ltd. |
1,490,245 | ||||||
| 42,407 |
Inmode, Ltd. (a) |
932,954 | ||||||
| 400,163 |
Israel Discount Bank, Ltd. - Class A |
2,086,190 | ||||||
| 37,302 |
Perion Network, Ltd. (a) |
856,081 | ||||||
| 14,476 |
Plus500, Ltd. |
311,292 | ||||||
| 156,571 |
Teva Pharmaceutical Industries, Ltd. (a) |
2,059,937 | ||||||
| 133,425 |
ZIM Integrated Shipping Services, Ltd. |
1,589,092 | ||||||
| 13,955,555 |
The accompanying notes are an integral part of these financial statements.
14
Vident International Equity Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Shares |
Security Description |
Value |
||||||
|
COMMON STOCKS - 97.5% (Continued) |
||||||||
|
Italy - 0.7% |
||||||||
| 377,094 |
A2A SpA |
$ | 685,559 | |||||
| 93,675 |
Iveco Group NV |
1,153,590 | ||||||
| 27,745 |
Leonardo SpA |
593,127 | ||||||
| 92,234 |
UnipolSai Assicurazioni SpA |
265,696 | ||||||
| 2,697,972 | ||||||||
|
Japan - 0.8% |
||||||||
| 157,800 |
Mazda Motor Corporation |
1,853,494 | ||||||
| 46,400 |
Suzuken Company Ltd. |
1,382,048 | ||||||
| 3,235,542 | ||||||||
|
Malaysia - 2.3% |
||||||||
| 1,423,600 |
CIMB Group Holdings Bhd |
1,937,932 | ||||||
| 877,700 |
Malayan Banking Bhd |
1,762,613 | ||||||
| 630,700 |
MISC Bhd |
1,010,077 | ||||||
| 1,231,700 |
Petronas Chemicals Group Bhd |
1,816,858 | ||||||
| 3,675,900 |
YTL Corporation Bhd |
2,068,202 | ||||||
| 8,595,682 | ||||||||
|
Mexico - 2.3% |
||||||||
| 173,095 |
Arca Continental SAB de CV |
1,863,562 | ||||||
| 2,269,993 |
Cemex SAB de CV (a) |
1,734,433 | ||||||
| 136,272 |
Fomento Economico Mexicano SAB de CV |
1,694,527 | ||||||
| 138,500 |
Grupo Financiero Banorte SAB de CV - Class O |
1,430,730 | ||||||
| 187,202 |
Qualitas Controladora SAB de CV |
2,100,559 | ||||||
| 8,823,811 | ||||||||
|
Netherlands - 2.7% |
||||||||
| 306,190 |
Aegon, Ltd. |
1,837,624 | ||||||
| 11,537 |
ING Groep NV |
158,431 | ||||||
| 65,902 |
Koninklijke Ahold Delhaize NV |
1,962,604 | ||||||
| 45,102 |
NN Group NV |
2,013,774 | ||||||
| 32,628 |
Randstad NV |
1,798,602 | ||||||
| 87,528 |
Stellantis NV |
2,286,020 | ||||||
| 10,057,055 | ||||||||
|
Norway - 4.8% |
||||||||
| 69,333 |
Aker BP ASA |
1,685,696 | ||||||
| 1,618,979 |
DNO ASA |
1,380,048 | ||||||
| 64,473 |
Equinor ASA |
1,591,562 |
The accompanying notes are an integral part of these financial statements.
15
Vident International Equity Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Shares |
Security Description |
Value |
||||||
|
COMMON STOCKS - 97.5% (Continued) |
||||||||
|
Norway - 4.8% (Continued) |
||||||||
| 260,509 |
Leroy Seafood Group ASA |
$ | 1,152,711 | |||||
| 103,452 |
Mowi ASA |
1,999,888 | ||||||
| 311,172 |
Norsk Hydro ASA |
1,601,181 | ||||||
| 232,646 |
Orkla ASA |
1,669,463 | ||||||
| 190,309 |
Storebrand ASA |
1,701,411 | ||||||
| 158,779 |
Telenor ASA |
1,740,700 | ||||||
| 613,771 |
Var Energi ASA |
1,876,767 | ||||||
| 55,913 |
Yara International ASA |
1,740,811 | ||||||
| 18,140,238 | ||||||||
|
Poland - 2.7% |
||||||||
| 50,739 |
Bank Polska Kasa Opieki SA |
2,201,120 | ||||||
| 14,560 |
KGHM Polska Miedz SA |
393,583 | ||||||
| 386 |
LPP SA |
1,736,463 | ||||||
| 122,881 |
ORLEN SA |
1,909,818 | ||||||
| 152,424 |
Powszechna Kasa Oszczednosci Bank Polski SA |
2,123,593 | ||||||
| 159,800 |
Powszechny Zaklad Ubezpieczen SA |
1,967,898 | ||||||
| 10,332,475 | ||||||||
|
Portugal - 0.5% |
||||||||
| 6,277,555 |
Banco Comercial Portugues SA - Class R (a) |
1,813,792 | ||||||
| 3,790 |
Galp Energia SGPS SA |
59,756 | ||||||
| 1,873,548 | ||||||||
|
Republic of Korea - 8.0% |
||||||||
| 27,664 |
CJ Corporation |
2,013,098 | ||||||
| 30,513 |
DB Insurance Company, Ltd. |
2,263,956 | ||||||
| 35,035 |
Doosan Bobcat, Inc. |
1,235,276 | ||||||
| 49,734 |
Hankook Tire & Technology Company, Ltd. |
2,024,319 | ||||||
| 14,407 |
Hyundai Glovis Company, Ltd. |
2,061,080 | ||||||
| 80,634 |
Hyundai Marine & Fire Insurance Company, Ltd. |
1,907,458 | ||||||
| 11,739 |
Hyundai Mobis Company, Ltd. |
2,137,810 | ||||||
| 34,350 |
Hyundai Wia Corporation |
1,550,342 | ||||||
| 26,445 |
Kia Corporation |
2,472,516 | ||||||
| 71,910 |
KT Corporation |
2,111,506 | ||||||
| 246,674 |
LG Uplus Corporation |
1,911,742 | ||||||
| 6,060 |
NongShim Company, Ltd. |
1,583,719 | ||||||
| 24,917 |
OCI Holdings Company, Ltd. |
1,758,935 |
The accompanying notes are an integral part of these financial statements.
16
Vident International Equity Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Shares |
Security Description |
Value |
||||||
|
COMMON STOCKS - 97.5% (Continued) |
||||||||
|
Republic of Korea - 8.0% (Continued) |
||||||||
| 20,545 |
Samsung C&T Corporation |
$ | 2,417,694 | |||||
| 9,446 |
Samsung SDS Company, Ltd. |
1,134,995 | ||||||
| 49,784 |
SK Telecom Company, Ltd. |
1,970,274 | ||||||
| 30,554,720 | ||||||||
|
Russian Federation - 0.0% |
||||||||
| 24,074 |
Severstal PAO - GDR (a)(b)(d) |
0 | ||||||
|
Singapore - 6.7% |
||||||||
| 986,000 |
ComfortDelGro Corporation, Ltd. |
989,960 | ||||||
| 77,300 |
DBS Group Holdings, Ltd. |
1,916,116 | ||||||
| 2,532,400 |
Genting Singapore, Ltd. |
1,713,881 | ||||||
| 246,235 |
Hafnia, Ltd. |
1,814,369 | ||||||
| 64,500 |
Jardine Cycle & Carriage, Ltd. |
1,220,828 | ||||||
| 357,800 |
Keppel, Ltd. |
1,926,574 | ||||||
| 1,503,600 |
Keppel REIT |
967,287 | ||||||
| 807,400 |
NetLink NBN Trust (d) |
504,400 | ||||||
| 191,400 |
Oversea-Chinese Banking Corporation, Ltd. |
1,847,666 | ||||||
| 381,900 |
Sembcorp Industries, Ltd. |
1,448,527 | ||||||
| 371,800 |
Singapore Airlines, Ltd. |
1,789,042 | ||||||
| 327,100 |
Singapore Technologies Engineering, Ltd. |
968,212 | ||||||
| 1,028,700 |
Singapore Telecommunications, Ltd. |
1,797,892 | ||||||
| 87,619 |
United Overseas Bank, Ltd. |
1,821,323 | ||||||
| 353,900 |
UOL Group, Ltd. |
1,550,254 | ||||||
| 118,100 |
Venture Corporation, Ltd. |
1,229,659 | ||||||
| 743,600 |
Wilmar International, Ltd. |
1,836,049 | ||||||
| 25,342,039 | ||||||||
|
South Africa - 1.1% |
||||||||
| 84,930 |
Aspen Pharmacare Holdings, Ltd. |
867,684 | ||||||
| 7,139 |
Harmony Gold Mining Company, Ltd. |
41,876 | ||||||
| 2,507,184 |
Old Mutual, Ltd. |
1,560,476 | ||||||
| 476,878 |
Sanlam, Ltd. |
1,828,338 | ||||||
| 4,298,374 | ||||||||
|
Spain - 1.2% |
||||||||
| 210,132 |
Banco Bilbao Vizcaya Argentaria SA |
2,088,836 | ||||||
| 87,967 |
Mapfre SA |
186,483 |
The accompanying notes are an integral part of these financial statements.
17
Vident International Equity Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Shares |
Security Description |
Value |
||||||
|
COMMON STOCKS - 97.5% (Continued) |
||||||||
|
Spain - 1.2% (Continued) |
||||||||
| 17,715 |
Repsol SA |
$ | 282,281 | |||||
| 447,947 |
Telefonica SA |
1,838,634 | ||||||
| 4,396,234 | ||||||||
|
Sweden - 3.8% |
||||||||
| 17,772 |
Autoliv, Inc. |
2,062,085 | ||||||
| 86,330 |
Getinge AB - Class B |
1,712,008 | ||||||
| 95,742 |
SKF AB - Class B |
2,089,263 | ||||||
| 260,770 |
SSAB AB - Class B |
2,043,328 | ||||||
| 316,775 |
Telefonaktiebolaget LM Ericsson - B Shares |
1,721,415 | ||||||
| 60,466 |
Trelleborg AB - Class B |
2,197,765 | ||||||
| 718,773 |
Volvo Car AB - Class B (a) |
2,622,952 | ||||||
| 14,448,816 | ||||||||
|
Switzerland - 4.6% |
||||||||
| 8,435 |
Bunge Global SA |
796,011 | ||||||
| 7,634 |
Chubb, Ltd. |
1,921,249 | ||||||
| 348,366 |
Glencore plc |
1,653,147 | ||||||
| 6,311 |
Helvetia Holding AG |
895,172 | ||||||
| 24,878 |
Holcim AG |
2,037,027 | ||||||
| 26,414 |
Julius Baer Group, Ltd. |
1,418,266 | ||||||
| 5,509 |
Kuehne + Nagel International AG |
1,861,880 | ||||||
| 17,231 |
Novartis AG |
1,751,181 | ||||||
| 55,548 |
Sandoz Group AG (a) |
1,732,267 | ||||||
| 6,539 |
Swatch Group AG |
1,549,072 | ||||||
| 16,169 |
Swiss Re AG |
1,957,430 | ||||||
| 119 |
Swisscom AG |
68,301 | ||||||
| 17,641,003 | ||||||||
|
Taiwan - 7.6% |
||||||||
| 1,160,000 |
Acer, Inc. |
1,656,907 | ||||||
| 44,000 |
Arcadyan Technology Corporation |
256,126 | ||||||
| 421,000 |
ASE Technology Holding Company, Ltd. |
1,851,310 | ||||||
| 343,000 |
Chicony Electronics Company, Ltd. |
2,034,594 | ||||||
| 1,550,000 |
Compal Electronics, Inc. |
1,789,810 | ||||||
| 826,000 |
Compeq Manufacturing Company, Ltd. |
1,988,598 | ||||||
| 380,000 |
Evergreen Marine Corporation Taiwan, Ltd. |
1,989,592 | ||||||
| 513,000 |
Hon Hai Precision Industry Company, Ltd. |
1,671,618 |
The accompanying notes are an integral part of these financial statements.
18
Vident International Equity Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Shares |
Security Description |
Value |
||||||
|
COMMON STOCKS - 97.5% (Continued) |
||||||||
|
Taiwan - 7.6% (Continued) |
||||||||
| 358,000 |
L&K Engineering Company, Ltd. |
$ | 1,908,382 | |||||
| 685,000 |
Pegatron Corporation |
1,852,845 | ||||||
| 397,000 |
Powertech Technology, Inc. |
1,959,284 | ||||||
| 415,000 |
Radiant Opto-Electronics Corporation |
1,936,522 | ||||||
| 142,000 |
Simplo Technology Company, Ltd. |
1,915,975 | ||||||
| 665,000 |
Tong Yang Industry Company, Ltd. |
2,080,656 | ||||||
| 322,000 |
Tripod Technology Corporation |
2,118,857 | ||||||
| 1,103,000 |
United Microelectronics Corporation |
1,704,600 | ||||||
| 28,715,676 | ||||||||
|
Thailand - 0.5% |
||||||||
| 36,539,600 |
TMBThanachart Bank pcl |
1,874,609 | ||||||
|
United Kingdom - 4.1% |
||||||||
| 236,935 |
Barratt Developments plc |
1,398,143 | ||||||
| 110,253 |
BT Group plc |
145,670 | ||||||
| 1,005,011 |
Centrica plc |
1,599,907 | ||||||
| 197,920 |
easyJet plc |
1,361,443 | ||||||
| 104,281 |
International Distributions Services plc (a) |
319,484 | ||||||
| 339,386 |
J Sainsbury plc |
1,071,542 | ||||||
| 62,982 |
Janus Henderson Group plc |
1,962,519 | ||||||
| 397,239 |
Kingfisher plc |
1,178,326 | ||||||
| 551,526 |
Marks & Spencer Group plc |
1,652,032 | ||||||
| 833,731 |
Taylor Wimpey plc |
1,453,796 | ||||||
| 485,170 |
Tesco plc |
1,711,029 | ||||||
| 2,128,193 |
Vodafone Group plc |
1,860,739 | ||||||
| 15,714,630 | ||||||||
|
TOTAL COMMON STOCKS (Cost $355,999,709) |
369,690,816 | |||||||
|
PREFERRED STOCKS - 1.4% |
||||||||
|
Brazil - 0.8% |
||||||||
| 458,161 |
Cia Energetica de Minas Gerais |
1,100,069 | ||||||
| 572,322 |
Metalurgica Gerdau SA |
1,163,385 | ||||||
| 116,554 |
Petroleo Brasileiro SA |
939,723 | ||||||
| 3,203,177 |
The accompanying notes are an integral part of these financial statements.
19
Vident International Equity Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Shares |
Security Description |
Value |
||||||
|
PREFERRED STOCKS - 1.4% (Continued) |
||||||||
|
Chile - 0.5% |
||||||||
| 755,996 |
Embotelladora Andina SA - Class B |
$ | 1,905,987 | |||||
|
Germany - 0.1% |
||||||||
| 32,191 |
Schaeffler AG |
234,268 | ||||||
|
TOTAL PREFERRED STOCKS (Cost $4,793,574) |
5,343,432 | |||||||
|
|
||||||||
|
SHORT-TERM INVESTMENTS - 0.5% |
||||||||
|
Money Market Deposit Account - 0.5% |
||||||||
| $ | 2,024,629 |
U.S. Bank Money Market Deposit Account, 4.21% (e) |
2,024,629 | |||||
|
TOTAL SHORT-TERM INVESTMENTS (Cost $2,024,629) |
2,024,629 | |||||||
|
TOTAL INVESTMENTS - 99.4% (Cost $362,817,912) |
377,058,877 | |||||||
|
Other Assets in Excess of Liabilities - 0.6% |
2,154,627 | |||||||
|
NET ASSETS - 100.0% |
$ | 379,213,504 |
|
Percentages are stated as a percent of net assets. |
|
|
(a) |
Non-income producing security. |
|
(b) |
Value determined using significant unobservable inputs. Classified as Level 3 in the fair value hierarchy. |
|
(c) |
Security exempt from registration under Rule 144(a) and Regulation S of the Securities Act of 1933. At February 29, 2024, the value of these securities amounted to $7,063,256 or 1.9% of net assets. |
|
(d) |
Security exempt from registration under Regulation S of the Securities Act of 1933. At February 29, 2024, the value of these securities amounted to $504,400 or 0.1% of net assets. |
|
(e) |
The Money Market Deposit Account (the "MMDA") is a short-term investment vehicle in which the Fund holds cash balances. The MMDA will bear interest at a variable rate that is determined based on conditions and may change daily and by any amount. The rate shown is as of February 29, 2024. |
GDR - Global Depositary Receipt.
The accompanying notes are an integral part of these financial statements.
20
Vident U.S. Equity Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited)
|
Shares |
Security Description |
Value |
||||||
|
COMMON STOCKS - 99.7% |
||||||||
|
Communication Services - 7.8% |
||||||||
| 334,688 |
AT&T, Inc. |
$ | 5,666,268 | |||||
| 147,410 |
Cargurus, Inc. (a) |
3,263,657 | ||||||
| 13,590 |
Comcast Corporation - Class A |
582,331 | ||||||
| 19,718 |
Electronic Arts, Inc. |
2,750,267 | ||||||
| 99,271 |
Iridium Communications, Inc. |
2,873,895 | ||||||
| 7,471 |
Meta Platforms, Inc. - Class A |
3,661,761 | ||||||
| 7,197 |
Netflix, Inc. (a) |
4,339,215 | ||||||
| 73,419 |
New York Times Company - Class A |
3,250,993 | ||||||
| 25,863 |
Pinterest, Inc. - Class A (a) |
949,172 | ||||||
| 143,758 |
Sirius XM Holdings, Inc. |
635,410 | ||||||
| 193,556 |
TEGNA, Inc. |
2,711,720 | ||||||
| 10,829 |
T-Mobile US, Inc. |
1,768,376 | ||||||
| 26,500 |
Trade Desk, Inc. - Class A (a) |
2,263,895 | ||||||
| 52,187 |
The Walt Disney Company |
5,823,025 | ||||||
| 97,727 |
Yelp, Inc. (a) |
3,756,626 | ||||||
| 44,296,611 | ||||||||
|
Consumer Discretionary - 12.4% |
||||||||
| 66,555 |
Amazon.com, Inc. (a) |
11,764,262 | ||||||
| 2,006 |
Booking Holdings, Inc. (a) |
6,958,473 | ||||||
| 2,655 |
Chipotle Mexican Grill, Inc. (a) |
7,138,684 | ||||||
| 30,231 |
Home Depot, Inc. |
11,506,221 | ||||||
| 18,886 |
McDonalds Corporation |
5,520,000 | ||||||
| 39,755 |
NIKE, Inc. - Class B |
4,131,737 | ||||||
| 5,316 |
O'Reilly Automotive, Inc. (a) |
5,780,725 | ||||||
| 58,804 |
Starbucks Corporation |
5,580,500 | ||||||
| 30,240 |
Tesla, Inc. (a) |
6,104,851 | ||||||
| 56,577 |
TJX Companies, Inc. |
5,609,044 | ||||||
| 70,094,497 | ||||||||
|
Consumer Staples - 6.9% |
||||||||
| 136,712 |
Altria Group, Inc. |
5,592,888 | ||||||
| 183,752 |
Coca-Cola Company |
11,028,795 | ||||||
| 3,770 |
Costco Wholesale Corporation |
2,804,465 | ||||||
| 66,302 |
PepsiCo, Inc. |
10,962,373 | ||||||
| 54,865 |
Procter & Gamble Company |
8,720,243 | ||||||
| 39,108,764 |
The accompanying notes are an integral part of these financial statements.
21
Vident U.S. Equity Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Shares |
Security Description |
Value |
||||||
|
COMMON STOCKS - 99.7% (Continued) |
||||||||
|
Energy - 4.7% |
||||||||
| 72,708 |
Chevron Corporation |
$ | 11,052,343 | |||||
| 38,568 |
EOG Resources, Inc. |
4,414,493 | ||||||
| 108,298 |
Exxon Mobil Corporation |
11,319,307 | ||||||
| 26,786,143 | ||||||||
|
Financials - 13.9% |
||||||||
| 19,783 |
American Financial Group, Inc. |
2,525,696 | ||||||
| 6,904 |
Ameriprise Financial, Inc. |
2,812,413 | ||||||
| 56,952 |
Bancorp, Inc. (a) |
2,542,337 | ||||||
| 17,825 |
Cboe Global Markets, Inc. |
3,422,400 | ||||||
| 55,081 |
Donnelley Financial Solutions, Inc. (a) |
3,556,029 | ||||||
| 81,066 |
Equitable Holdings, Inc. |
2,775,700 | ||||||
| 3,645 |
Erie Indemnity Company - Class A |
1,483,078 | ||||||
| 79,799 |
Federated Hermes, Inc. |
2,811,319 | ||||||
| 89,966 |
First Financial Bankshares, Inc. |
2,783,548 | ||||||
| 54,252 |
International Bancshares Corporation |
2,815,136 | ||||||
| 61,119 |
JPMorgan Chase & Company |
11,371,801 | ||||||
| 23,754 |
Mastercard, Inc. - Class A |
11,277,449 | ||||||
| 182,269 |
MGIC Investment Corporation |
3,625,330 | ||||||
| 7,380 |
MSCI, Inc. |
4,139,959 | ||||||
| 19,174 |
RLI Corporation |
2,808,032 | ||||||
| 21,638 |
SEI Investments Company |
1,455,156 | ||||||
| 39,660 |
Visa, Inc. - Class A |
11,209,502 | ||||||
| 1,588 |
White Mountains Insurance Group, Ltd. - ADR |
2,803,519 | ||||||
| 72,031 |
Zions Bancorporation |
2,840,182 | ||||||
| 79,058,586 | ||||||||
|
Health Care - 11.1% |
||||||||
| 22,551 |
AbbVie, Inc. |
3,970,104 | ||||||
| 8,343 |
Align Technology, Inc. (a) |
2,523,090 | ||||||
| 108,848 |
Bristol-Myers Squibb Company |
5,524,036 | ||||||
| 156,534 |
Corcept Therapeutics, Inc. (a) |
3,678,549 | ||||||
| 24,188 |
Doximity, Inc. - Class A (a) |
682,827 | ||||||
| 7,287 |
IDEXX Laboratories, Inc. (a) |
4,191,701 | ||||||
| 69,489 |
Johnson & Johnson |
11,214,135 | ||||||
| 8,484 |
Lantheus Holdings, Inc. (a) |
554,684 | ||||||
| 2,305 |
Medpace Holdings, Inc. (a) |
916,284 |
The accompanying notes are an integral part of these financial statements.
22
Vident U.S. Equity Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Shares |
Security Description |
Value |
||||||
|
COMMON STOCKS - 99.7% (Continued) |
||||||||
|
Health Care - 11.1% (Continued) |
||||||||
| 86,870 |
Merck & Company, Inc. |
$ | 11,045,521 | |||||
| 21,329 |
UnitedHealth Group, Inc. |
10,527,994 | ||||||
| 7,651 |
West Pharmaceutical Services, Inc. |
2,741,812 | ||||||
| 28,421 |
Zoetis, Inc. |
5,636,737 | ||||||
| 63,207,474 | ||||||||
|
Industrials - 11.4% |
||||||||
| 17,040 |
A.O. Smith Corporation |
1,412,616 | ||||||
| 23,176 |
Atkore, Inc. (a) |
3,926,014 | ||||||
| 48,623 |
Brady Corporation - Class A |
2,833,748 | ||||||
| 17,360 |
Caterpillar, Inc. |
5,797,546 | ||||||
| 5,032 |
Cintas Corporation |
3,163,166 | ||||||
| 3,104 |
Encore Wire Corporation |
748,064 | ||||||
| 77,691 |
ExlService Holdings, Inc. (a) |
2,417,744 | ||||||
| 38,950 |
Fastenal Company |
2,843,739 | ||||||
| 35,383 |
Graco, Inc. |
3,229,053 | ||||||
| 16,142 |
Illinois Tool Works, Inc. |
4,231,625 | ||||||
| 27,963 |
ITT, Inc. |
3,527,253 | ||||||
| 14,405 |
Landstar System, Inc. |
2,739,831 | ||||||
| 7,983 |
Old Dominion Freight Line, Inc. |
3,532,318 | ||||||
| 45,111 |
Paychex, Inc. |
5,531,511 | ||||||
| 37,459 |
Trex Company, Inc. (a) |
3,437,238 | ||||||
| 71,674 |
Uber Technologies, Inc. (a) |
5,698,083 | ||||||
| 14,354 |
Verisk Analytics, Inc. |
3,472,233 | ||||||
| 92,616 |
Wabash National Corporation |
2,526,564 | ||||||
| 3,665 |
WW Grainger, Inc. |
3,567,731 | ||||||
| 64,636,077 | ||||||||
|
Information Technology - 26.4% (b) |
||||||||
| 25,399 |
Adobe, Inc. (a) |
14,230,552 | ||||||
| 61,622 |
Apple, Inc. |
11,138,176 | ||||||
| 35,660 |
Applied Materials, Inc. |
7,189,769 | ||||||
| 7,377 |
Arista Networks, Inc. (a) |
2,047,413 | ||||||
| 8,983 |
Broadcom, Inc. |
11,682,302 | ||||||
| 23,163 |
Cadence Design Systems, Inc. (a) |
7,050,354 | ||||||
| 115,095 |
Cisco Systems, Inc. |
5,567,145 | ||||||
| 7,941 |
Crowdstrike Holdings, Inc. - Class A (a) |
2,574,075 |
The accompanying notes are an integral part of these financial statements.
23
Vident U.S. Equity Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Shares |
Security Description |
Value |
||||||
|
COMMON STOCKS - 99.7% (Continued) |
||||||||
|
Information Technology - 26.4% (b) (Continued) |
||||||||
| 63,949 |
Dynatrace, Inc. (a) |
$ | 3,168,673 | |||||
| 2,494 |
Fair Isaac Corporation (a) |
3,167,156 | ||||||
| 83,128 |
Fortinet, Inc. (a) |
5,744,976 | ||||||
| 7,629 |
Gartner, Inc. (a) |
3,551,757 | ||||||
| 8,392 |
KLA Corporation |
5,725,862 | ||||||
| 4,843 |
Lam Research Corporation |
4,543,945 | ||||||
| 37,612 |
Lattice Semiconductor Corporation (a) |
2,881,455 | ||||||
| 87,124 |
LiveRamp Holdings, Inc. (a) |
3,047,598 | ||||||
| 12,846 |
Manhattan Associates, Inc. (a) |
3,254,277 | ||||||
| 84,874 |
Microchip Technology, Inc. |
7,141,298 | ||||||
| 27,408 |
Microsoft Corporation |
11,337,045 | ||||||
| 5,388 |
Motorola Solutions, Inc. |
1,780,141 | ||||||
| 8,661 |
NVIDIA Corporation |
6,851,890 | ||||||
| 5,744 |
Palo Alto Networks, Inc. (a) |
1,783,799 | ||||||
| 114,151 |
Photronics, Inc. (a) |
3,286,407 | ||||||
| 19,559 |
Qualys, Inc. (a) |
3,361,410 | ||||||
| 57,164 |
Rambus, Inc. (a) |
3,386,395 | ||||||
| 23,080 |
Salesforce, Inc. (a) |
7,127,566 | ||||||
| 12,223 |
Synopsys, Inc. (a) |
7,012,702 | ||||||
| 149,634,138 | ||||||||
|
Materials - 2.2% |
||||||||
| 8,200 |
Alpha Metallurgical Resources, Inc. |
3,093,450 | ||||||
| 5,619 |
Nucor Corporation |
1,080,534 | ||||||
| 1,735 |
Reliance, Inc. |
557,317 | ||||||
| 13,015 |
Southern Copper Corporation |
1,052,393 | ||||||
| 22,135 |
Steel Dynamics, Inc. |
2,962,106 | ||||||
| 60,747 |
Warrior Met Coal, Inc. |
3,460,757 | ||||||
| 12,206,557 | ||||||||
|
Real Estate - 1.7% |
||||||||
| 34,602 |
Apple Hospitality REIT, Inc. |
556,746 | ||||||
| 76,401 |
DigitalBridge Group, Inc. |
1,403,486 | ||||||
| 228,860 |
eXp World Holdings, Inc. |
2,998,066 | ||||||
| 96,058 |
Host Hotels & Resorts, Inc. |
1,992,243 | ||||||
| 253,050 |
Sunstone Hotel Investors, Inc. |
2,831,630 | ||||||
| 9,782,171 |
The accompanying notes are an integral part of these financial statements.
24
Vident U.S. Equity Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Shares |
Security Description |
Value |
||||||
|
COMMON STOCKS - 99.7% (Continued) |
||||||||
|
Utilities - 1.2% |
||||||||
| 57,408 |
National Fuel Gas Company |
$ | 2,798,066 | |||||
| 16,882 |
Otter Tail Corporation |
1,527,146 | ||||||
| 43,823 |
Vistra Corporation |
2,390,106 | ||||||
| 6,715,318 | ||||||||
|
TOTAL COMMON STOCKS (Cost $494,900,364) |
565,526,336 | |||||||
|
|
||||||||
|
SHORT-TERM INVESTMENTS - 0.2% |
||||||||
|
Money Market Deposit Account - 0.2% |
||||||||
| 1,268,307 |
U.S. Bank Money Market Deposit Account, 4.21% (c) |
1,268,307 | ||||||
|
TOTAL SHORT-TERM INVESTMENTS (Cost $1,268,307) |
1,268,307 | |||||||
|
TOTAL INVESTMENTS - 99.9% (Cost $496,168,671) |
566,794,643 | |||||||
|
Other Assets in Excess of Liabilities - 0.1% |
687,838 | |||||||
|
NET ASSETS - 100.0% |
$ | 567,482,481 |
|
Percentages are stated as a percent of net assets. |
|
|
(a) |
Non-income producing security. |
|
(b) |
To the extent that the Fund invests more heavily in particular sectors of the economy, its performance will be especially sensitive to developments that significantly affect those sectors. See Note 7 in Notes to Financial Statements. |
|
(c) |
The Money Market Deposit Account (the "MMDA") is a short-term investment vehicle in which the Fund holds cash balances. The MMDA will bear interest at a variable rate that is determined based on conditions and may change daily and by any amount. The rate shown is as of February 29, 2024. |
The Global Industry Classification Standard (GICS®) was developed by and/or is the exclusive property of MSCI, Inc. ("MSCI") and Standard & Poor's Financial Services LLC ("S&P"). GICS® is a service mark of MSCI and S&P and has been licensed for use by the Fund's Administrator, U.S. Bancorp Fund Services, LLC.
The accompanying notes are an integral part of these financial statements.
25
Vident U.S. Bond Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited)
|
Principal |
Security Description |
Value |
||||||
|
CORPORATE BONDS - 24.6% |
||||||||
|
Consumer Discretionary - 1.8% |
||||||||
|
AutoNation, Inc. |
||||||||
| 1,400,000 |
03/01/2032, 3.850% |
$ | 1,222,483 | |||||
|
Brunswick Corporation |
||||||||
| 1,530,000 |
08/18/2031, 2.400% |
1,204,921 | ||||||
|
Dick's Sporting Goods, Inc. |
||||||||
| 1,715,000 |
01/15/2052, 4.100% |
1,212,379 | ||||||
|
General Motors Company |
||||||||
| 1,125,000 |
04/01/2046, 6.750% |
1,190,448 | ||||||
|
Lear Corporation |
||||||||
| 1,320,000 |
05/15/2049, 5.250% |
1,188,522 | ||||||
|
Tapestry, Inc. |
||||||||
| 1,570,000 |
03/15/2032, 3.050% |
1,272,431 | ||||||
| 7,291,184 | ||||||||
|
Consumer Staples - 0.9% |
||||||||
|
Altria Group, Inc. |
||||||||
| 1,600,000 |
05/06/2050, 4.450% |
1,262,444 | ||||||
|
Kraft Heinz Foods Company |
||||||||
| 105,000 |
01/26/2039, 6.875% |
118,137 | ||||||
| 990,000 |
02/09/2040, 6.500% |
1,074,868 | ||||||
|
Philip Morris International, Inc. |
||||||||
| 1,370,000 |
11/15/2043, 4.875% |
1,236,152 | ||||||
| 3,691,601 | ||||||||
|
Energy - 3.8% |
||||||||
|
Apache Corporation |
||||||||
| 1,450,000 |
09/01/2040, 5.100% |
1,214,303 | ||||||
|
Continental Resources, Inc. |
||||||||
| 1,510,000 |
06/01/2044, 4.900% |
1,227,771 | ||||||
|
Devon Energy Corporation |
||||||||
| 1,075,000 |
09/30/2031, 7.875% |
1,221,564 | ||||||
|
Enterprise Products Operating LLC |
||||||||
| 1,350,000 |
02/15/2078, 5.375% (a) |
1,252,004 | ||||||
|
EQT Corporation |
||||||||
| 1,120,000 |
02/01/2030, 7.000% |
1,187,071 |
The accompanying notes are an integral part of these financial statements.
26
Vident U.S. Bond Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Principal |
Security Description |
Value |
||||||
|
CORPORATE BONDS - 24.6% (Continued) |
||||||||
|
Energy - 3.8% (Continued) |
||||||||
|
Halliburton Company |
||||||||
| 375,000 |
09/15/2039, 7.450% |
$ | 450,309 | |||||
|
Hess Corporation |
||||||||
| 950,000 |
01/15/2040, 6.000% |
996,702 | ||||||
|
Marathon Oil Corporation |
||||||||
| 945,000 |
10/01/2037, 6.600% |
985,463 | ||||||
| 265,000 |
06/01/2045, 5.200% |
230,158 | ||||||
|
Marathon Petroleum Corporation |
||||||||
| 1,045,000 |
03/01/2041, 6.500% |
1,109,690 | ||||||
|
NOV, Inc. |
||||||||
| 1,570,000 |
12/01/2042, 3.950% |
1,173,114 | ||||||
|
ONEOK Partners LP |
||||||||
| 1,145,000 |
02/01/2041, 6.125% |
1,165,357 | ||||||
|
Ovintiv, Inc. |
||||||||
| 1,000,000 |
11/01/2031, 7.375% |
1,089,897 | ||||||
|
Valero Energy Corporation |
||||||||
| 1,100,000 |
06/15/2037, 6.625% |
1,181,129 | ||||||
|
Western Midstream Operating LP |
||||||||
| 1,350,000 |
02/01/2050, 5.250% |
1,195,125 | ||||||
| 15,679,657 | ||||||||
|
Financials - 9.3% |
||||||||
|
Ally Financial, Inc. |
||||||||
| 1,190,000 |
02/14/2033, 6.700% |
1,172,824 | ||||||
|
American Assets Trust LP |
||||||||
| 1,570,000 |
02/01/2031, 3.375% |
1,261,368 | ||||||
|
Ares Capital Corporation |
||||||||
| 1,490,000 |
11/15/2031, 3.200% |
1,215,720 | ||||||
|
Athene Holding, Ltd. |
||||||||
| 1,700,000 |
05/25/2051, 3.950% |
1,249,600 | ||||||
|
Blackstone Secured Lending Fund |
||||||||
| 1,430,000 |
09/30/2028, 2.850% |
1,244,873 | ||||||
|
Blue Owl Capital Corporation |
||||||||
| 1,300,000 |
07/15/2026, 3.400% |
1,210,807 |
The accompanying notes are an integral part of these financial statements.
27
Vident U.S. Bond Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Principal |
Security Description |
Value |
||||||
|
CORPORATE BONDS - 24.6% (Continued) |
||||||||
|
Financials - 9.3% (Continued) |
||||||||
|
Brighthouse Financial, Inc. |
||||||||
| 1,490,000 |
06/22/2047, 4.700% |
$ | 1,152,596 | |||||
|
Capital One Financial Corporation |
||||||||
| 1,695,000 |
07/29/2032, 2.359% (a) |
1,281,378 | ||||||
|
Citizens Financial Group, Inc. |
||||||||
| 1,360,000 |
07/27/2026, 2.850% |
1,267,969 | ||||||
|
Comerica Bank |
||||||||
| 1,285,000 |
08/25/2033, 5.332% (a) |
1,147,430 | ||||||
|
Corebridge Financial, Inc. |
||||||||
| 1,245,000 |
12/15/2052, 6.875% (a) |
1,243,617 | ||||||
|
Discover Financial Services |
||||||||
| 1,200,000 |
11/29/2032, 6.700% |
1,255,086 | ||||||
|
Enstar Finance LLC |
||||||||
| 1,400,000 |
01/15/2042, 5.500% (a) |
1,263,971 | ||||||
|
Fifth Third Bancorp |
||||||||
| 810,000 |
03/01/2038, 8.250% |
960,655 | ||||||
|
Fifth Third Bank |
||||||||
| 280,000 |
Series BKNT, 03/15/2026, 3.850% |
269,708 | ||||||
|
GLP Capital LP / GLP Financing II, Inc. |
||||||||
| 1,205,000 |
06/01/2028, 5.750% |
1,196,629 | ||||||
|
Huntington Bancshares, Inc. |
||||||||
| 1,655,000 |
08/15/2036, 2.487% (a) |
1,252,137 | ||||||
|
KeyBank NA |
||||||||
| 1,325,000 |
Series BKNT, 08/08/2032, 4.900% |
1,162,448 | ||||||
|
Kilroy Realty LP |
||||||||
| 1,440,000 |
02/15/2030, 3.050% |
1,207,694 | ||||||
|
Legg Mason, Inc. |
||||||||
| 1,000,000 |
01/15/2044, 5.625% |
1,004,098 | ||||||
|
Lincoln National Corporation |
||||||||
| 1,070,000 |
06/15/2040, 7.000% |
1,167,751 | ||||||
|
Manufacturers & Traders Trust Company |
||||||||
| 1,320,000 |
Series BKNT, 08/17/2027, 3.400% |
1,204,872 |
The accompanying notes are an integral part of these financial statements.
28
Vident U.S. Bond Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Principal |
Security Description |
Value |
||||||
|
CORPORATE BONDS - 24.6% (Continued) |
||||||||
|
Financials - 9.3% (Continued) |
||||||||
|
Markel Group, Inc. |
||||||||
| 1,100,000 |
04/05/2046, 5.000% |
$ | 977,958 | |||||
|
MetLife, Inc. |
||||||||
| 900,000 |
08/01/2039, 10.750% (a) |
1,212,146 | ||||||
|
MGIC Investment Corporation |
||||||||
| 1,190,000 |
08/15/2028, 5.250% |
1,150,437 | ||||||
|
Prudential Financial, Inc. |
||||||||
| 1,375,000 |
09/15/2047, 4.500% (a) |
1,285,231 | ||||||
|
Regions Bank |
||||||||
| 1,208,000 |
Series BKNT, 06/26/2037, 6.450% |
1,226,600 | ||||||
|
Synchrony Financial |
||||||||
| 1,200,000 |
08/04/2026, 3.700% |
1,132,726 | ||||||
|
Synovus Bank |
||||||||
| 1,250,000 |
02/15/2028, 5.625% |
1,207,526 | ||||||
|
Truist Financial Corporation |
||||||||
| 1,390,000 |
Series MTN, 07/28/2033, 4.916% (a) |
1,278,346 | ||||||
|
Unum Group |
||||||||
| 1,290,000 |
08/15/2042, 5.750% |
1,253,481 | ||||||
|
US Bancorp |
||||||||
| 1,635,000 |
11/03/2036, 2.491% (a) |
1,264,457 | ||||||
|
Zions Bancorp |
||||||||
| 1,480,000 |
10/29/2029, 3.250% |
1,201,291 | ||||||
| 38,583,430 | ||||||||
|
Health Care - 1.0% |
||||||||
|
Cardinal Health, Inc. |
||||||||
| 900,000 |
06/15/2047, 4.368% |
741,056 | ||||||
|
Centene Corporation |
||||||||
| 1,250,000 |
12/15/2029, 4.625% |
1,185,631 | ||||||
|
HCA, Inc. |
||||||||
| 1,000,000 |
06/15/2047, 5.500% |
932,206 | ||||||
|
Viatris, Inc. |
||||||||
| 1,640,000 |
06/22/2040, 3.850% |
1,213,108 | ||||||
| 4,072,001 |
The accompanying notes are an integral part of these financial statements.
29
Vident U.S. Bond Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Principal |
Security Description |
Value |
||||||
|
CORPORATE BONDS - 24.6% (Continued) |
||||||||
|
Industrials - 1.3% |
||||||||
|
BNSF Funding Trust I |
||||||||
| 1,210,000 |
12/15/2055, 6.613% (a) |
$ | 1,205,795 | |||||
|
Concentrix Corporation |
||||||||
| 1,200,000 |
08/02/2033, 6.850% |
1,174,213 | ||||||
|
FedEx Corporation |
||||||||
| 1,105,000 |
01/15/2044, 5.100% |
1,025,015 | ||||||
|
Flowserve Corporation |
||||||||
| 1,410,000 |
10/01/2030, 3.500% |
1,239,523 | ||||||
|
Owens Corning |
||||||||
| 1,160,000 |
07/15/2047, 4.300% |
951,358 | ||||||
| 5,595,904 | ||||||||
|
Information Technology - 1.5% |
||||||||
|
Corning, Inc. |
||||||||
| 685,000 |
11/15/2079, 5.450% |
634,267 | ||||||
|
HP, Inc. |
||||||||
| 1,095,000 |
09/15/2041, 6.000% |
1,122,882 | ||||||
|
Kyndryl Holdings, Inc. |
||||||||
| 1,600,000 |
10/15/2041, 4.100% |
1,196,607 | ||||||
|
Qorvo, Inc. |
||||||||
| 1,015,000 |
10/15/2029, 4.375% |
946,445 | ||||||
|
Vontier Corporation |
||||||||
| 1,510,000 |
04/01/2031, 2.950% |
1,244,809 | ||||||
|
Warnermedia Holdings, Inc. |
||||||||
| 1,400,000 |
03/15/2062, 5.391% |
1,127,105 | ||||||
| 6,272,115 | ||||||||
|
Materials - 0.7% |
||||||||
|
Dow Chemical Company |
||||||||
| 650,000 |
05/15/2039, 9.400% |
867,589 | ||||||
|
Freeport-McMoRan, Inc. |
||||||||
| 1,180,000 |
03/15/2043, 5.450% |
1,096,628 | ||||||
|
Mosaic Company |
||||||||
| 1,050,000 |
11/15/2043, 5.625% |
1,003,821 | ||||||
| 2,968,038 |
The accompanying notes are an integral part of these financial statements.
30
Vident U.S. Bond Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Principal |
Security Description |
Value |
||||||
|
CORPORATE BONDS - 24.6% (Continued) |
||||||||
|
Real Estate - 1.6% |
||||||||
|
Brixmor Operating Partnership LP |
||||||||
| 1,285,000 |
07/01/2030, 4.050% |
$ | 1,182,298 | |||||
|
COPT Defense Properties LP |
||||||||
| 1,510,000 |
04/15/2031, 2.750% |
1,219,196 | ||||||
|
EPR Properties |
||||||||
| 1,345,000 |
08/15/2029, 3.750% |
1,174,795 | ||||||
|
Sabra Health Care LP |
||||||||
| 1,530,000 |
12/01/2031, 3.200% |
1,240,775 | ||||||
|
Simon Property Group LP |
||||||||
| 850,000 |
02/01/2040, 6.750% |
934,208 | ||||||
|
VICI Properties LP |
||||||||
| 750,000 |
05/15/2052, 5.625% |
679,860 | ||||||
| 6,431,132 | ||||||||
|
Utilities - 2.7% |
||||||||
|
American Electric Power Company, Inc. |
||||||||
| 1,430,000 |
02/15/2062, 3.875% (a) |
1,279,158 | ||||||
|
CMS Energy Corporation |
||||||||
| 1,420,000 |
06/01/2050, 4.750% (a) |
1,303,179 | ||||||
|
Duke Energy Corporation |
||||||||
| 1,590,000 |
01/15/2082, 3.250% (a) |
1,348,539 | ||||||
|
Edison International |
||||||||
| 1,250,000 |
06/15/2053, 8.125% (a) |
1,286,048 | ||||||
|
National Fuel Gas Company |
||||||||
| 1,130,000 |
01/15/2026, 5.500% |
1,128,677 | ||||||
|
NextEra Energy Capital Holdings, Inc. |
||||||||
| 1,140,000 |
12/01/2077, 4.800% (a) |
1,038,861 | ||||||
| 180,000 |
03/15/2082, 3.800% (a) |
160,400 | ||||||
|
Phillips 66 Company |
||||||||
| 1,030,000 |
10/01/2046, 4.900% |
920,052 | ||||||
|
Sempra |
||||||||
| 1,415,000 |
04/01/2052, 4.125% (a) |
1,305,295 |
The accompanying notes are an integral part of these financial statements.
31
Vident U.S. Bond Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Principal |
Security Description |
Value |
||||||
|
CORPORATE BONDS - 24.6% (Continued) |
||||||||
|
Utilities - 2.7% (Continued) |
||||||||
|
Southern Company |
||||||||
| 1,355,000 |
Series 21-A, 09/15/2051, 3.750% (a) |
$ | 1,273,470 | |||||
| 11,043,679 | ||||||||
|
TOTAL CORPORATE BONDS (Cost $103,851,200) |
101,628,741 | |||||||
|
MORTGAGE BACKED SECURITIES - U.S. GOVERNMENT AGENCY - 9.9% |
||||||||
|
Federal National Mortgage Association |
||||||||
| 2,130,000 |
03/15/2038, 7.000% (b) |
2,186,660 | ||||||
| 760,000 |
03/01/2040, 4.500% (b) |
718,691 | ||||||
| 1,420,000 |
03/15/2041, 5.000% (b) |
1,376,652 | ||||||
| 4,075,000 |
03/15/2041, 6.000% (b) |
4,092,246 | ||||||
| 380,000 |
03/15/2043, 3.000% (b) |
325,135 | ||||||
| 700,000 |
03/15/2047, 2.500% (b) |
575,094 | ||||||
| 1,120,000 |
05/25/2050, 2.000% (b) |
879,854 | ||||||
| 2,787,996 |
04/01/2052, 4.000% |
2,566,717 | ||||||
| 3,532,656 |
05/01/2052, 4.000% |
3,253,276 | ||||||
| 3,605,058 |
06/01/2052, 4.000% |
3,319,944 | ||||||
| 4,590,000 |
03/15/2053, 6.500% (b) |
4,671,050 | ||||||
| 2,985,000 |
03/25/2053, 5.500% (b) |
2,951,631 | ||||||
| 26,916,950 | ||||||||
|
Government National Mortgage Association |
||||||||
| 3,570,000 |
03/15/2040, 6.000% (b) |
3,587,003 | ||||||
| 690,000 |
03/15/2041, 4.500% (b) |
659,058 | ||||||
| 770,000 |
03/15/2041, 5.000% (b) |
751,830 | ||||||
| 310,000 |
03/15/2043, 3.000% (b) |
271,974 | ||||||
| 700,000 |
03/20/2050, 2.500% (b) |
593,031 | ||||||
| 870,000 |
04/20/2050, 2.000% (b) |
708,470 | ||||||
| 2,440,000 |
10/20/2052, 5.500% (b) |
2,424,017 | ||||||
| 4,880,000 |
08/20/2053, 6.500% (b) |
4,947,449 | ||||||
| 13,942,832 | ||||||||
|
TOTAL MORTGAGE BACKED SECURITIES - U.S. GOVERNMENT AGENCY (Cost $42,699,904) |
40,859,782 |
The accompanying notes are an integral part of these financial statements.
32
Vident U.S. Bond Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Principal |
Security Description |
Value |
||||||
|
U.S. GOVERNMENT AGENCY ISSUES - 3.0% |
||||||||
|
Financials - 1.4% |
||||||||
|
Federal Farm Credit Banks Funding Corporation |
||||||||
| 700,000 |
06/23/2026, 4.375% |
$ | 697,720 | |||||
| 445,000 |
08/14/2026, 4.500% |
444,769 | ||||||
|
Federal Home Loan Banks |
||||||||
| 430,000 |
09/04/2025, 0.375% |
402,304 | ||||||
| 190,000 |
11/17/2026, 4.625% |
190,772 | ||||||
| 190,000 |
12/21/2026, 1.250% |
173,936 | ||||||
| 100,000 |
07/15/2036, 5.500% |
109,537 | ||||||
|
Federal Home Loan Mortgage Corporation |
||||||||
| 400,000 |
Series USD, 07/21/2025, 0.375% |
376,577 | ||||||
| 740,000 |
09/23/2025, 0.375% |
691,129 | ||||||
| 300,000 |
03/15/2031, 6.750% |
343,659 | ||||||
| 350,000 |
11/15/2038, 5.600% (c) |
170,808 | ||||||
|
Federal National Mortgage Association |
||||||||
| 270,000 |
06/17/2025, 0.500% |
255,491 | ||||||
| 465,000 |
08/25/2025, 0.375% |
435,640 | ||||||
| 290,000 |
11/07/2025, 0.500% |
270,338 | ||||||
| 750,000 |
04/24/2026, 2.125% |
713,225 | ||||||
| 235,000 |
09/24/2026, 1.875% |
220,236 | ||||||
| 100,000 |
01/15/2030, 7.125% |
114,231 | ||||||
| 100,000 |
05/15/2030, 7.250% |
115,707 | ||||||
| 100,000 |
11/15/2030, 6.625% |
112,837 | ||||||
| 100,000 |
07/15/2037, 5.625% |
110,040 | ||||||
| 5,948,956 | ||||||||
|
Utilities - 1.6% |
||||||||
|
Tennessee Valley Authority |
||||||||
| 530,000 |
Series E, 11/01/2025, 6.750% |
545,281 | ||||||
| 250,000 |
Series A, 02/01/2027, 2.875% |
238,492 | ||||||
| 370,000 |
03/15/2028, 3.875% |
364,310 | ||||||
| 300,000 |
05/01/2030, 7.125% |
343,918 | ||||||
| 505,000 |
04/01/2036, 5.880% |
560,990 | ||||||
| 785,000 |
01/15/2038, 6.150% |
903,968 |
The accompanying notes are an integral part of these financial statements.
33
Vident U.S. Bond Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Principal |
Security Description |
Value |
||||||
|
U.S. GOVERNMENT AGENCY ISSUES - 3.0% (Continued) |
||||||||
|
Utilities - 1.6% (Continued) |
||||||||
| 1,300,000 |
09/15/2039, 5.250% |
$ | 1,346,507 | |||||
| 955,000 |
12/15/2042, 3.500% |
790,023 | ||||||
| 590,000 |
04/01/2056, 5.375% |
627,374 | ||||||
| 420,000 |
09/15/2060, 4.625% |
393,591 | ||||||
| 310,000 |
09/15/2065, 4.250% |
269,196 | ||||||
| 6,383,650 | ||||||||
|
TOTAL U.S. GOVERNMENT AGENCY ISSUES (Cost $11,680,276) |
12,332,606 | |||||||
|
U.S. GOVERNMENT NOTES/BONDS - 61.5% |
||||||||
|
U.S. Treasury Bonds - 24.6% |
||||||||
|
United States Treasury Bonds |
||||||||
| 16,979,000 |
02/15/2026, 6.000% |
17,425,362 | ||||||
| 655,000 |
11/15/2040, 4.250% |
640,263 | ||||||
| 1,580,000 |
05/15/2041, 2.250% |
1,153,122 | ||||||
| 1,135,000 |
05/15/2041, 4.375% |
1,122,874 | ||||||
| 4,275,000 |
08/15/2041, 1.750% |
2,846,549 | ||||||
| 1,660,000 |
08/15/2041, 3.750% |
1,514,361 | ||||||
| 3,000,000 |
11/15/2041, 2.000% |
2,076,738 | ||||||
| 3,085,000 |
11/15/2041, 3.125% |
2,567,660 | ||||||
| 1,960,000 |
02/15/2042, 2.375% |
1,440,179 | ||||||
| 3,425,000 |
02/15/2042, 3.125% |
2,839,940 | ||||||
| 4,050,000 |
05/15/2042, 3.000% |
3,282,240 | ||||||
| 3,390,000 |
05/15/2042, 3.250% |
2,850,381 | ||||||
| 4,535,000 |
08/15/2042, 2.750% |
3,527,114 | ||||||
| 3,040,000 |
08/15/2042, 3.375% |
2,599,022 | ||||||
| 4,335,000 |
11/15/2042, 2.750% |
3,357,762 | ||||||
| 3,095,000 |
11/15/2042, 4.000% |
2,888,082 | ||||||
| 4,850,000 |
02/15/2043, 3.125% |
3,978,895 | ||||||
| 2,410,000 |
02/15/2043, 3.875% |
2,205,432 | ||||||
| 4,110,000 |
05/15/2043, 2.875% |
3,233,735 | ||||||
| 2,745,000 |
05/15/2043, 3.875% |
2,509,262 | ||||||
| 4,325,000 |
08/15/2043, 3.625% |
3,811,237 | ||||||
| 360,000 |
08/15/2043, 4.375% |
352,350 |
The accompanying notes are an integral part of these financial statements.
34
Vident U.S. Bond Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Principal |
Security Description |
Value |
||||||
|
U.S. GOVERNMENT NOTES/BONDS - 61.5% (Continued) |
||||||||
|
U.S. Treasury Bonds - 24.6% (Continued) |
||||||||
| 4,010,000 |
11/15/2043, 3.750% |
$ | 3,593,336 | |||||
| 3,985,000 |
02/15/2044, 3.625% |
3,502,052 | ||||||
| 4,445,000 |
05/15/2044, 3.375% |
3,756,546 | ||||||
| 4,335,000 |
08/15/2044, 3.125% |
3,515,583 | ||||||
| 4,130,000 |
11/15/2044, 3.000% |
3,274,316 | ||||||
| 3,705,000 |
02/15/2045, 2.500% |
2,684,822 | ||||||
| 3,975,000 |
05/15/2045, 3.000% |
3,142,036 | ||||||
| 1,115,000 |
08/15/2045, 2.875% |
860,793 | ||||||
| 1,815,000 |
11/15/2045, 3.000% |
1,429,596 | ||||||
| 3,745,000 |
02/15/2046, 2.500% |
2,686,745 | ||||||
| 3,611,000 |
05/15/2046, 2.500% |
2,583,417 | ||||||
| 3,470,000 |
08/15/2046, 2.250% |
2,355,534 | ||||||
| 101,607,336 | ||||||||
|
U.S. Treasury Inflation Indexed Bonds - 5.4% |
||||||||
|
United States Treasury Inflation Indexed Bonds |
||||||||
| 1,657,966 |
01/15/2027, 2.375% |
1,673,383 | ||||||
| 1,508,136 |
01/15/2028, 1.750% |
1,495,899 | ||||||
| 1,545,680 |
04/15/2028, 3.625% |
1,644,889 | ||||||
| 657,211 |
01/15/2029, 2.500% |
675,421 | ||||||
| 1,240,843 |
04/15/2029, 3.875% |
1,358,116 | ||||||
| 3,091,018 |
02/15/2040, 2.125% |
3,129,225 | ||||||
| 2,458,264 |
02/15/2041, 2.125% |
2,489,803 | ||||||
| 2,409,598 |
02/15/2042, 0.750% |
1,922,691 | ||||||
| 2,234,768 |
02/15/2043, 0.625% |
1,712,078 | ||||||
| 2,198,004 |
02/15/2044, 1.375% |
1,922,698 | ||||||
| 1,576,182 |
02/15/2045, 0.750% |
1,206,990 | ||||||
| 1,559,981 |
02/15/2046, 1.000% |
1,246,907 | ||||||
| 1,181,788 |
02/15/2047, 0.875% |
910,855 | ||||||
| 814,768 |
02/15/2048, 1.000% |
640,666 | ||||||
| 207,232 |
02/15/2049, 1.000% |
162,381 | ||||||
| 22,192,002 | ||||||||
|
U.S. Treasury Inflation Indexed Notes - 4.6% |
||||||||
|
United States Treasury Inflation Indexed Notes |
||||||||
| 3,649,370 |
04/15/2026, 0.125% |
3,496,406 |
The accompanying notes are an integral part of these financial statements.
35
Vident U.S. Bond Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Principal |
Security Description |
Value |
||||||
|
U.S. GOVERNMENT NOTES/BONDS - 61.5% (Continued) |
||||||||
|
U.S. Treasury Inflation Indexed Notes - 4.6% (Continued) |
||||||||
| 435,098 |
07/15/2026, 0.125% |
$ | 416,880 | |||||
| 836,300 |
10/15/2026, 0.125% |
797,860 | ||||||
| 1,866,694 |
01/15/2027, 0.375% |
1,780,888 | ||||||
| 2,026,173 |
04/15/2027, 0.125% |
1,909,466 | ||||||
| 1,330,620 |
01/15/2028, 0.500% |
1,258,412 | ||||||
| 1,278,325 |
04/15/2028, 1.250% |
1,241,353 | ||||||
| 498,076 |
01/15/2029, 0.875% |
474,137 | ||||||
| 1,186,289 |
01/15/2030, 0.125% |
1,069,315 | ||||||
| 245,262 |
07/15/2030, 0.125% |
220,124 | ||||||
| 1,319,763 |
01/15/2031, 0.125% |
1,169,544 | ||||||
| 721,029 |
07/15/2031, 0.125% |
635,927 | ||||||
| 1,394,291 |
01/15/2032, 0.125% |
1,213,994 | ||||||
| 897,388 |
07/15/2032, 0.625% |
811,562 | ||||||
| 1,678,541 |
01/15/2033, 1.125% |
1,570,519 | ||||||
| 999,900 |
07/15/2033, 1.375% |
957,364 | ||||||
| 19,023,751 | ||||||||
|
U.S. Treasury Notes - 26.9% |
||||||||
|
United States Treasury Notes |
||||||||
| 18,705,000 |
05/31/2025, 0.250% |
17,657,228 | ||||||
| 16,287,000 |
06/15/2025, 2.875% |
15,876,962 | ||||||
| 2,331,000 |
06/30/2025, 2.750% |
2,268,536 | ||||||
| 17,976,000 |
08/31/2025, 0.250% |
16,801,942 | ||||||
| 15,912,000 |
09/15/2025, 3.500% |
15,605,570 | ||||||
| 13,509,000 |
09/30/2025, 3.000% |
13,145,946 | ||||||
| 3,180,000 |
10/15/2025, 4.250% |
3,154,038 | ||||||
| 2,365,000 |
10/31/2025, 3.000% |
2,299,131 | ||||||
| 280,000 |
11/30/2025, 0.375% |
259,749 | ||||||
| 590,000 |
12/31/2025, 2.625% |
568,820 | ||||||
| 4,090,000 |
02/28/2026, 0.500% |
3,770,389 | ||||||
| 4,000,000 |
02/28/2026, 2.500% |
3,839,063 | ||||||
| 3,255,000 |
03/15/2026, 4.625% |
3,254,746 | ||||||
| 1,190,000 |
03/31/2026, 0.750% |
1,100,146 |
The accompanying notes are an integral part of these financial statements.
36
Vident U.S. Bond Strategy ETFTM
Schedules of Investments
February 29, 2024 (Unaudited) (Continued)
|
Principal |
Security Description |
Value |
||||||
|
U.S. GOVERNMENT NOTES/BONDS - 61.5% (Continued) |
||||||||
|
U.S. Treasury Notes - 26.9% (Continued) |
||||||||
| 2,285,000 |
03/31/2026, 2.250% |
$ | 2,179,051 | |||||
| 2,280,000 |
04/15/2026, 3.750% |
2,240,813 | ||||||
| 1,675,000 |
04/30/2026, 0.750% |
1,543,944 | ||||||
| 1,255,000 |
04/30/2026, 2.375% |
1,198,329 | ||||||
| 1,310,000 |
05/15/2026, 1.625% |
1,229,507 | ||||||
| 1,130,000 |
05/15/2026, 3.625% |
1,107,577 | ||||||
| 835,000 |
05/31/2026, 0.750% |
767,515 | ||||||
| 485,000 |
05/31/2026, 2.125% |
459,897 | ||||||
| 595,000 |
06/15/2026, 4.125% |
589,399 | ||||||
| 110,918,298 | ||||||||
|
TOTAL U.S. GOVERNMENT NOTES/BONDS (Cost $255,222,606) |
253,741,387 | |||||||
|
SHORT-TERM INVESTMENTS - 7.6% |
||||||||
|
Money Market Deposit Account - 7.6% |
||||||||
| 31,512,050 |
U.S. Bank Money Market Deposit Account, 4.21% (d)(e) |
31,512,050 | ||||||
|
TOTAL SHORT-TERM INVESTMENTS (Cost $31,512,050) |
31,512,050 | |||||||
|
TOTAL INVESTMENTS - 106.6% (Cost $444,966,036) |
440,074,566 | |||||||
|
Liabilities in Excess of Other Assets - (6.6)% |
(27,298,683 | ) | ||||||
|
NET ASSETS - 100.0% |
$ | 412,775,883 |
|
Percentages are stated as a percent of net assets. |
|
|
(a) |
Variable or Floating Rate Security based on a reference index and spread. Certain securities are fixed to variable and currently in the fixed phase. Rate shown is the rate in effect as of February 29, 2024. |
|
(b) |
Security purchased on a forward-commitment basis ("TBA commitment"). On February 29, 2024, the total value of TBA commitments was $31,719,845 or 7.68% of net assets. |
|
(c) |
Zero coupon bond, rate shown is the effective yield as of February 29, 2024. |
|
(d) |
The Money Market Deposit Account (the "MMDA") is a short-term investment vehicle in which the Fund holds cash balances. The MMDA will bear interest at a variable rate that is determined based on conditions and may change daily and by any amount. The rate shown is as of February 29, 2024. |
|
(e) |
All or a portion of this security has been pledged as collateral in connection with TBA commitments. At February 29, 2024, the value of securities pledged amounted to $31,512,050. In addition, the Fund held cash collateral in the amount of $1,710,000. |
The Global Industry Classification Standard (GICS®) was developed by and/or is the exclusive property of MSCI, Inc. ("MSCI") and Standard & Poor's Financial Services LLC ("S&P"). GICS® is a service mark of MSCI and S&P and has been licensed for use by the Fund's Administrator, U.S. Bancorp Fund Services, LLC.
The accompanying notes are an integral part of these financial statements.
37
Vident ETFs
Statements of Assets and Liabilities
February 29, 2024 (Unaudited)
|
Vident |
Vident |
Vident |
||||||||||
|
ASSETS |
||||||||||||
|
Investments in securities, at value* |
$ | 377,058,877 | $ | 566,794,643 | $ | 440,074,566 | ||||||
|
Cash held as collateral for TBA commitments |
- | - | 1,710,000 | |||||||||
|
Dividend tax reclaim receivable |
1,450,646 | - | - | |||||||||
|
Dividends and interest receivable |
885,106 | 724,589 | 3,063,965 | |||||||||
|
Receivable for capital shares sold |
- | 82,559,423 | - | |||||||||
|
Receivable for securities sold |
- | 233,043,339 | 453,306 | |||||||||
|
Transaction fees receivable |
- | - | 575 | |||||||||
|
Total assets |
379,394,629 | 883,121,994 | 445,302,412 | |||||||||
|
LIABILITIES |
||||||||||||
|
Payable for securities purchased |
- | 236,626,850 | 32,393,787 | |||||||||
|
Payable for capital shares redeemed |
- | 78,792,140 | - | |||||||||
|
Management fees payable |
181,125 | 220,523 | 132,742 | |||||||||
|
Total liabilities |
181,125 | 315,639,513 | 32,526,529 | |||||||||
|
NET ASSETS |
$ | 379,213,504 | $ | 567,482,481 | $ | 412,775,883 | ||||||
|
NET ASSETS CONSIST OF: |
||||||||||||
|
Paid-in capital |
$ | 521,185,961 | $ | 496,577,114 | $ | 471,301,543 | ||||||
|
Total distributable earnings (accumulated deficit) |
(141,972,457 | ) | 70,905,367 | (58,525,660 | ) | |||||||
|
Net assets |
$ | 379,213,504 | $ | 567,482,481 | $ | 412,775,883 |
The accompanying notes are an integral part of these financial statements.
38
Vident ETFs
Statements of Assets and Liabilities
February 29, 2024 (Unaudited) (Continued)
|
Vident |
Vident |
Vident |
||||||||||
|
Net Asset Value: |
||||||||||||
|
Net assets |
$ | 379,213,504 | $ | 567,482,481 | $ | 412,775,883 | ||||||
|
Shares outstanding ^ |
15,600,000 | 10,625,000 | 9,500,000 | |||||||||
|
Net asset value, offering and redemption price per share |
$ | 24.31 | $ | 53.41 | $ | 43.45 | ||||||
|
* Identified Cost: |
||||||||||||
|
Investments in Securities |
$ | 362,817,912 | $ | 496,168,671 | $ | 444,966,036 |
|
^ |
No par value, unlimited number of shares authorized. |
The accompanying notes are an integral part of these financial statements.
39
Vident ETFs
Statements of Operations
For the Six-Months Ended February 29, 2024 (Unaudited)
|
Vident |
Vident |
Vident |
||||||||||
|
INCOME |
||||||||||||
|
Dividends^ |
4,042,344 | 4,157,597 | - | |||||||||
|
Interest |
24,786 | 23,857 | 9,131,808 | |||||||||
|
Total investment income |
4,067,130 | 4,181,454 | 9,131,808 | |||||||||
|
EXPENSES |
||||||||||||
|
Management fees |
1,104,612 | 1,328,860 | 806,528 | |||||||||
|
Total expenses |
1,104,612 | 1,328,860 | 806,528 | |||||||||
|
Net investment income (loss) |
2,962,518 | 2,852,594 | 8,325,280 | |||||||||
|
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS |
||||||||||||
|
Net realized gain (loss) on: |
||||||||||||
|
Investments in securities |
2,025,908 | (553,200 | ) | (5,003,750 | ) | |||||||
|
In-kind redemptions |
125,006 | 30,000,930 | 259,494 | |||||||||
|
Foreign currency |
(49,407 | ) | - | - | ||||||||
|
Change in unrealized appreciation (depreciation) on: |
||||||||||||
|
Investments in securities |
19,818,000 | 23,274,461 | 11,845,632 | |||||||||
|
Foreign currency and translation of other assets and liabilities in foreign currency |
(12,666 | ) | - | - | ||||||||
|
Net realized and unrealized gain (loss) on investments |
21,906,841 | 52,722,191 | 7,101,376 | |||||||||
|
Net increase (decrease) in net assets resulting from operations |
$ | 24,869,359 | $ | 55,574,785 | $ | 15,426,656 |
|
^ Net of foreign withholding taxes |
$ | 601,717 | $ | - | $ | - |
The accompanying notes are an integral part of these financial statements.
40
Vident International Equity Strategy ETFTM
Statements of Changes in Net Assets
|
Six-Months |
Year Ended |
|||||||
|
OPERATIONS |
||||||||
|
Net investment income (loss) |
$ | 2,962,518 | $ | 15,869,287 | ||||
|
Net realized gain (loss) on investments and foreign currency |
2,101,507 | (3,728,583 | ) | |||||
|
Change in unrealized appreciation (depreciation) on investments and foreign currency |
19,805,334 | 23,251,345 | ||||||
|
Net increase (decrease) in net assets resulting from operations |
24,869,359 | 35,392,049 | ||||||
|
DISTRIBUTIONS TO SHAREHOLDERS |
||||||||
|
Net distributions to shareholders |
(7,769,045 | ) | (17,386,128 | ) | ||||
|
Total distributions to shareholders |
(7,769,045 | ) | (17,386,128 | ) | ||||
|
CAPITAL SHARE TRANSACTIONS |
||||||||
|
Proceeds from shares sold |
2,407,150 | 8,298,210 | ||||||
|
Payments for shares redeemed |
(4,340,100 | ) | (2,341,060 | ) | ||||
|
Transaction fees (Note 6) |
4,732 | 4,558 | ||||||
|
Net increase (decrease) in net assets derived from capital share transactions (a) |
(1,928,218 | ) | 5,961,708 | |||||
|
Net increase (decrease) in net assets |
$ | 15,172,096 | $ | 23,967,629 | ||||
|
NET ASSETS |
||||||||
|
Beginning of period/year |
$ | 364,041,408 | $ | 340,073,779 | ||||
|
End of period/year |
$ | 379,213,504 | $ | 364,041,408 |
|
(a) |
A summary of capital share transactions is as follows: |
|
Shares |
Shares |
|||||||
|
Shares sold |
100,000 | 400,000 | ||||||
|
Shares redeemed |
(200,000 | ) | (100,000 | ) | ||||
|
Net increase (decrease) |
(100,000 | ) | 300,000 |
The accompanying notes are an integral part of these financial statements.
41
Vident U.S. Equity Strategy ETFTM
Statements of Changes in Net Assets
|
Six-Months |
Year Ended |
|||||||
|
OPERATIONS |
||||||||
|
Net investment income (loss) |
$ | 2,852,594 | $ | 7,654,271 | ||||
|
Net realized gain (loss) on investments |
29,447,730 | 60,147,327 | ||||||
|
Change in unrealized appreciation (depreciation) on investments |
23,274,461 | 24,646,842 | ||||||
|
Net increase (decrease) in net assets resulting from operations |
55,574,785 | 92,448,440 | ||||||
|
DISTRIBUTIONS TO SHAREHOLDERS |
||||||||
|
Net distributions to shareholders |
(3,402,065 | ) | (7,553,684 | ) | ||||
|
Total distributions to shareholders |
(3,402,065 | ) | (7,553,684 | ) | ||||
|
CAPITAL SHARE TRANSACTIONS |
||||||||
|
Proceeds from shares sold |
82,559,423 | 134,334,320 | ||||||
|
Payments for shares redeemed |
(106,431,395 | ) | (143,815,850 | ) | ||||
|
Transaction fees (Note 6) |
- | 136 | ||||||
|
Net increase (decrease) in net assets derived from capital share transactions (a) |
(23,871,972 | ) | (9,481,394 | ) | ||||
|
Net increase (decrease) in net assets |
$ | 28,300,748 | $ | 75,413,362 | ||||
|
NET ASSETS |
||||||||
|
Beginning of period/year |
$ | 539,181,733 | $ | 463,768,371 | ||||
|
End of period/year |
$ | 567,482,481 | $ | 539,181,733 |
|
(a) |
A summary of capital share transactions is as follows: |
|
Shares |
Shares |
|||||||
|
Shares sold |
1,550,000 | 3,000,000 | ||||||
|
Shares redeemed |
(2,025,000 | ) | (3,200,000 | ) | ||||
|
Net increase (decrease) |
(475,000 | ) | (200,000 | ) |
The accompanying notes are an integral part of these financial statements.
42
Vident U.S. Bond Strategy ETFTM
Statements of Changes in Net Assets
|
Six-Months |
Year Ended |
|||||||
|
OPERATIONS |
||||||||
|
Net investment income (loss) |
$ | 8,325,280 | $ | 13,767,108 | ||||
|
Net realized gain (loss) on investments |
(4,744,256 | ) | (19,981,658 | ) | ||||
|
Change in unrealized appreciation (depreciation) on investments |
11,845,632 | 4,366,175 | ||||||
|
Net increase (decrease) in net assets resulting from operations |
15,426,656 | (1,848,375 | ) | |||||
|
DISTRIBUTIONS TO SHAREHOLDERS |
||||||||
|
Net distributions to shareholders |
(8,282,856 | ) | (13,499,504 | ) | ||||
|
Total distributions to shareholders |
(8,282,856 | ) | (13,499,504 | ) | ||||
|
CAPITAL SHARE TRANSACTIONS |
||||||||
|
Proceeds from shares sold |
34,581,850 | 30,272,960 | ||||||
|
Payments for shares redeemed |
(17,208,730 | ) | (4,345,510 | ) | ||||
|
Transaction fees (Note 6) |
3,403 | 756 | ||||||
|
Net increase (decrease) in net assets derived from capital share transactions (a) |
17,376,523 | 25,928,206 | ||||||
|
Net increase (decrease) in net assets |
$ | 24,520,323 | $ | 10,580,327 | ||||
|
NET ASSETS |
||||||||
|
Beginning of period/year |
$ | 388,255,560 | $ | 377,675,233 | ||||
|
End of period/year |
$ | 412,775,883 | $ | 388,255,560 |
|
(a) |
A summary of capital share transactions is as follows: |
|
Shares |
Shares |
|||||||
|
Shares sold |
800,000 | 700,000 | ||||||
|
Shares redeemed |
(400,000 | ) | (100,000 | ) | ||||
|
Net increase (decrease) |
400,000 | 600,000 |
The accompanying notes are an integral part of these financial statements.
43
Vident International Equity Strategy ETFTM
Financial Highlights
For a capital share outstanding throughout the period/year
|
Six-Months |
Year Ended August 31, |
|||||||||||||||||||||||
|
(Unaudited) |
2023 |
2022 |
2021 |
2020 |
2019 |
|||||||||||||||||||
|
Net asset value, beginning of period/year |
$ | 23.19 | $ | 22.08 | $ | 27.80 | $ | 21.54 | $ | 22.59 | $ | 25.19 | ||||||||||||
|
INCOME (LOSS) FROM INVESTMENT OPERATIONS: |
||||||||||||||||||||||||
|
Net investment income (loss) (1) |
0.19 | 1.01 | 1.34 | 0.78 | 0.51 | 0.74 | ||||||||||||||||||
|
Net realized and unrealized gain (loss) on investments (4) |
1.43 | 1.20 | (5.60 | ) | 6.34 | (0.93 | ) | (2.64 | ) | |||||||||||||||
|
Total from investment operations |
1.62 | 2.21 | (4.26 | ) | 7.12 | (0.42 | ) | (1.90 | ) | |||||||||||||||
|
DISTRIBUTIONS TO SHAREHOLDERS: |
||||||||||||||||||||||||
|
Distributions from: |
||||||||||||||||||||||||
|
Net investment income |
(0.50 | ) | (1.10 | ) | (1.46 | ) | (0.86 | ) | (0.64 | ) | (0.70 | ) | ||||||||||||
|
Total distributions to shareholders |
(0.50 | ) | (1.10 | ) | (1.46 | ) | (0.86 | ) | (0.64 | ) | (0.70 | ) | ||||||||||||
|
CAPITAL SHARE TRANSACTIONS |
||||||||||||||||||||||||
|
Transaction fees (Note 6) |
0.00 | (2) | 0.00 | (2) | 0.00 | (2) | 0.00 | (2) | 0.01 | 0.00 | (2) | |||||||||||||
|
Net asset value, end of period/year |
$ | 24.31 | $ | 23.19 | $ | 22.08 | $ | 27.80 | $ | 21.54 | $ | 22.59 | ||||||||||||
|
Total return |
7.04 | %(5) | 10.31 | % | -15.77 | % | 33.22 | % | -1.98 | % | -7.61 | % | ||||||||||||
|
SUPPLEMENTAL DATA: |
||||||||||||||||||||||||
|
Net assets at end of period/year (000's) |
$ | 379,214 | $ | 364,041 | $ | 340,074 | $ | 486,453 | $ | 437,301 | $ | 569,345 | ||||||||||||
The accompanying notes are an integral part of these financial statements.
44
Vident International Equity Strategy ETFTM
Financial Highlights
For a capital share outstanding throughout the period/year (Continued)
|
Six-Months |
Year Ended August 31, |
|||||||||||||||||||||||
|
(Unaudited) |
2023 |
2022 |
2021 |
2020 |
2019 |
|||||||||||||||||||
|
RATIOS TO AVERAGE NET ASSETS: |
||||||||||||||||||||||||
|
Expenses to average net assets (before management fees waived) |
0.61 | %(6) | 0.61 | % | 0.61 | % | 0.61 | % | 0.61 | % | 0.61 | % | ||||||||||||
|
Expenses to average net assets (after management fees waived) |
0.61 | %(6) | 0.61 | % | 0.60 | % | 0.59 | % | 0.60 | % | 0.61 | % | ||||||||||||
|
Net investment income (loss) to average net assets (before management fees waived) |
1.64 | %(6) | 4.53 | % | 5.22 | % | 3.02 | % | 2.29 | % | 3.09 | % | ||||||||||||
|
Net investment income (loss) to average net assets (after management fees waived) |
1.64 | %(6) | 4.53 | % | 5.23 | % | 3.04 | % | 2.30 | % | 3.09 | % | ||||||||||||
|
Portfolio turnover rate (3) |
31 | %(5) | 82 | % | 70 | % | 74 | % | 79 | % | 76 | % |
|
(1) |
Calculated based on average shares outstanding during the period/year. |
|
(2) |
Less than $0.005. |
|
(3) |
Excludes the impact of in-kind transactions. |
|
(4) |
Realized and unrealized gains and losses per share in this caption are balancing amounts necessary to reconcile the change in net asset value per share for the period, and may not reconcile with the aggregate gains and losses in the Statement of Operations due to share transactions for the period. |
|
(5) |
Not annualized. |
|
(6) |
Annualized. |
The accompanying notes are an integral part of these financial statements.
45
Vident U.S. Equity Strategy ETFTM
Financial Highlights
For a capital share outstanding throughout the period/year
|
Six-Months |
Year Ended August 31, |
|||||||||||||||||||||||
|
(Unaudited) |
2023 |
2022 |
2021 |
2020 |
2019 |
|||||||||||||||||||
|
Net asset value, beginning of period/year |
$ | 48.57 | $ | 41.04 | $ | 44.58 | $ | 30.03 | $ | 29.72 | $ | 35.33 | ||||||||||||
|
INCOME (LOSS) FROM INVESTMENT OPERATIONS: |
||||||||||||||||||||||||
|
Net investment income (loss) (1) |
0.26 | 0.67 | 0.62 | 0.46 | 0.45 | 0.49 | ||||||||||||||||||
|
Net realized and unrealized gain (loss) on investments (4) |
4.89 | 7.53 | (3.56 | ) | 14.56 | 0.33 | (5.60 | ) | ||||||||||||||||
|
Total from investment operations |
5.15 | 8.20 | (2.94 | ) | 15.02 | 0.78 | (5.11 | ) | ||||||||||||||||
|
DISTRIBUTIONS TO SHAREHOLDERS: |
||||||||||||||||||||||||
|
Distributions from: |
||||||||||||||||||||||||
|
Net investment income |
(0.31 | ) | (0.67 | ) | (0.60 | ) | (0.47 | ) | (0.47 | ) | (0.50 | ) | ||||||||||||
|
Total distributions to shareholders |
(0.31 | ) | (0.67 | ) | (0.60 | ) | (0.47 | ) | (0.47 | ) | (0.50 | ) | ||||||||||||
|
CAPITAL SHARE TRANSACTIONS |
||||||||||||||||||||||||
|
Transaction fees (Note 6) |
- | 0.00 | (2) | 0.00 | (2) | - | - | 0.00 | (2) | |||||||||||||||
|
Net asset value, end of period/year |
$ | 53.41 | $ | 48.57 | $ | 41.04 | $ | 44.58 | $ | 30.03 | $ | 29.72 | ||||||||||||
|
Total return |
10.63 | %(5) | 20.24 | % | -6.66 | % | 50.29 | % | 2.70 | % | -14.49 | % | ||||||||||||
|
SUPPLEMENTAL DATA: |
||||||||||||||||||||||||
|
Net assets at end of period/year (000's) |
$ | 567,482 | $ | 539,182 | $ | 463,768 | $ | 427,974 | $ | 330,357 | $ | 478,413 | ||||||||||||
The accompanying notes are an integral part of these financial statements.
46
Vident U.S. Equity Strategy ETFTM
Financial Highlights
For a capital share outstanding throughout the period/year (Continued)
|
Six-Months |
Year Ended August 31, |
|||||||||||||||||||||||
|
(Unaudited) |
2023 |
2022 |
2021 |
2020 |
2019 |
|||||||||||||||||||
|
RATIOS TO AVERAGE NET ASSETS: |
||||||||||||||||||||||||
|
Expenses to average net assets (before management fees waived) |
0.50 | %(6) | 0.50 | % | 0.50 | % | 0.50 | % | 0.50 | % | 0.50 | % | ||||||||||||
|
Expenses to average net assets (after management fees waived) |
0.50 | %(6) | 0.50 | % | 0.49 | % | 0.48 | % | 0.49 | % | 0.50 | % | ||||||||||||
|
Net investment income (loss) to average net assets (before management fees waived) |
1.07 | %(6) | 1.54 | % | 1.41 | % | 1.17 | % | 1.53 | % | 1.56 | % | ||||||||||||
|
Net investment income (loss) to average net assets (after management fees waived) |
1.07 | %(6) | 1.54 | % | 1.42 | % | 1.19 | % | 1.54 | % | 1.56 | % | ||||||||||||
|
Portfolio turnover rate (3) |
29 | %(5) | 167 | % | 63 | % | 65 | % | 66 | % | 71 | % |
|
(1) |
Calculated based on average shares outstanding during the period/year. |
|
(2) |
Less than $0.005. |
|
(3) |
Excludes the impact of in-kind transactions. |
|
(4) |
Realized and unrealized gains and losses per share in this caption are balancing amounts necessary to reconcile the change in net asset value per share for the period, and may not reconcile with the aggregate gains and losses in the Statement of Operations due to share transactions for the period. |
|
(5) |
Not annualized. |
|
(6) |
Annualized. |
The accompanying notes are an integral part of these financial statements.
47
Vident U.S. Bond Strategy ETFTM
Financial Highlights
For a capital share outstanding throughout the period/year
|
Six-Months |
Year Ended August 31, |
|||||||||||||||||||||||
|
(Unaudited) |
2023 |
2022 |
2021 |
2020 |
2019 |
|||||||||||||||||||
|
Net asset value, beginning of period/year |
$ | 42.67 | $ | 44.43 | $ | 51.96 | $ | 52.01 | $ | 51.22 | $ | 47.93 | ||||||||||||
|
INCOME (LOSS) FROM INVESTMENT OPERATIONS: |
||||||||||||||||||||||||
|
Net investment income (loss) (1) |
0.90 | 1.60 | 0.85 | 0.80 | 1.23 | 1.50 | ||||||||||||||||||
|
Net realized and unrealized gain (loss) on investments (4) |
0.77 | (1.80 | ) | (7.23 | ) | (0.05 | ) | 0.88 | 3.34 | |||||||||||||||
|
Total from investment operations |
1.67 | (0.20 | ) | (6.38 | ) | 0.75 | 2.11 | 4.84 | ||||||||||||||||
|
DISTRIBUTIONS TO SHAREHOLDERS: |
||||||||||||||||||||||||
|
Distributions from: |
||||||||||||||||||||||||
|
Net investment income |
(0.89 | ) | (1.56 | ) | (1.05 | ) | (0.80 | ) | (1.33 | ) | (1.56 | ) | ||||||||||||
|
From realized gains |
- | - | (0.10 | ) | - | - | - | |||||||||||||||||
|
Total distributions to shareholders |
(0.89 | ) | (1.56 | ) | (1.15 | ) | (0.80 | ) | (1.33 | ) | (1.56 | ) | ||||||||||||
|
CAPITAL SHARE TRANSACTIONS |
||||||||||||||||||||||||
|
Transaction fees (Note 6) |
0.00 | (2) | 0.00 | (2) | 0.00 | (2) | 0.00 | (2) | 0.01 | 0.01 | ||||||||||||||
|
Net asset value, end of period/year |
$ | 43.45 | $ | 42.67 | $ | 44.43 | $ | 51.96 | $ | 52.01 | $ | 51.22 | ||||||||||||
|
Total return |
3.99 | %(5) | -0.45 | % | -12.41 | % | 1.46 | % | 4.26 | % | 10.37 | % | ||||||||||||
|
SUPPLEMENTAL DATA: |
||||||||||||||||||||||||
|
Net assets at end of period/year (000's) |
$ | 412,776 | $ | 388,256 | $ | 377,675 | $ | 415,673 | $ | 400,494 | $ | 486,612 | ||||||||||||
The accompanying notes are an integral part of these financial statements.
48
Vident U.S. Bond Strategy ETFTM
Financial Highlights
For a capital share outstanding throughout the period/year (Continued)
|
Six-Months |
Year Ended August 31, |
|||||||||||||||||||||||
|
(Unaudited) |
2023 |
2022 |
2021 |
2020 |
2019 |
|||||||||||||||||||
|
RATIOS TO AVERAGE NET ASSETS: |
||||||||||||||||||||||||
|
Expenses to average net assets (before management fees waived) |
0.41 | %(6) | 0.41 | % | 0.41 | % | 0.41 | % | 0.41 | % | 0.41 | % | ||||||||||||
|
Expenses to average net assets (after management fees waived) |
0.41 | %(6) | 0.41 | % | 0.40 | % | 0.39 | % | 0.40 | % | 0.41 | % | ||||||||||||
|
Net investment income (loss) to average net assets (before management fees waived) |
4.23 | %(6) | 3.69 | % | 1.76 | % | 1.53 | % | 2.42 | % | 3.11 | % | ||||||||||||
|
Net investment income (loss) to average net assets (after management fees waived) |
4.23 | %(6) | 3.69 | % | 1.77 | % | 1.55 | % | 2.43 | % | 3.11 | % | ||||||||||||
|
Portfolio turnover rate (3) |
101 | %(5) | 185 | % | 247 | % | 238 | % | 247 | % | 384 | % |
|
(1) |
Calculated based on average shares outstanding during the period/year. |
|
(2) |
Less than $0.005. |
|
(3) |
Excludes the impact of in-kind transactions. |
|
(4) |
Realized and unrealized gains and losses per share in this caption are balancing amounts necessary to reconcile the change in net asset value per share for the period, and may not reconcile with the aggregate gains and losses in the Statement of Operations due to share transactions for the period. |
|
(5) |
Not annualized. |
|
(6) |
Annualized. |
The accompanying notes are an integral part of these financial statements.
49
Vident ETFs
Notes to Financial Statements
February 29, 2024 (Unaudited)
NOTE 1 - ORGANIZATION
Vident International Equity Strategy ETFTM, Vident U.S. Equity Strategy ETFTM and Vident U.S. Bond Strategy ETFTM (individually each a "Fund" or collectively the "Funds") are diversified series of ETF Series Solutions ("ESS" or the "Trust"), an open-end management investment company consisting of multiple investment series, organized as a Delaware statutory trust on February 9, 2012. The Trust is registered with the U.S. Securities and Exchange Commission ("SEC") under the Investment Company Act of 1940, as amended (the "1940 Act"), as an open-end management investment company and the offering of the Funds' shares is registered under the Securities Act of 1933, as amended (the "Securities Act"). The investment objectives of the Funds are to seek to track the performance, before fees and expenses, of the Vident Core International Equity IndexTM, the Vident U.S. Quality IndexTM and the Vident Core U.S. Bond IndexTM, respectively. Vident International Equity Strategy ETFTM commenced operations on October 29, 2013; Vident U.S. Equity Strategy ETFTM commenced operations on January 21, 2014; and Vident U.S. Bond Strategy ETFTM commenced operations on October 15, 2014.
The end of the reporting period for the Funds is February 29, 2024, and the period covered by these Notes to Financial Statements is the six-month period from September 1, 2023 to February 29, 2024 (the "current fiscal period").
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
The Funds are investment companies and accordingly follow the investment company accounting and reporting guidance of the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 946 Financial Services - Investment Companies.
The following is a summary of significant accounting policies consistently followed by the Funds. These policies are in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP").
|
A. |
Security Valuation. All equity securities, including domestic and foreign common stocks, preferred stocks, and exchange traded funds that are traded on a national securities exchange, except those listed on the Nasdaq Global Market®, Nasdaq Global SelectMarket® and Nasdaq Capital Market® exchanges (collectively "Nasdaq"), are valued at the last reported sale price on the exchange on which the security is principally traded. Securities traded on Nasdaq will be valued at the Nasdaq Official Closing Price ("NOCP"). If, on a particular day, an exchange traded or Nasdaq security does not trade, then the mean between the most recent quoted bid and asked prices will be used. All equity securities that are not traded on a listed exchange are valued at the last sale price in the over-the-counter market. If a non-exchange traded |
50
Vident ETFs
NOTES TO FINANCIAL STATEMENTS
February 29, 2024 (Unaudited) (Continued)
security does not trade on a particular day, then the mean between the last quoted closing bid and asked price will be used. Prices denominated in foreign currencies are converted to U.S. dollar equivalents at the current exchange rate, which approximates fair value.
Investments in mutual funds, including money market funds, are valued at their net asset value ("NAV") per share.
Debt securities, including short-term debt instruments, are valued in accordance with prices provided by a pricing service. Pricing services may use various valuation methodologies such as the mean between the bid and asked prices, matrix pricing and other analytical pricing models as well as market transactions and dealer quotations.
Deposit accounts are valued at acquisition cost, which approximates fair value.
Securities for which quotations are not readily available are valued at their respective fair values in accordance with pricing procedures adopted by the Funds' Board of Trustees (the "Board"). When a security is "fair valued," consideration is given to the facts and circumstances relevant to the particular situation, including a review of various factors set forth in the pricing procedures adopted by the Board. The use of fair value pricing by the Funds may cause the NAV of the shares to differ significantly from the NAV that would be calculated without regard to such considerations.
As described above, the Funds utilize various methods to measure the fair value of their investments on a recurring basis. U.S. GAAP establishes a hierarchy that prioritizes inputs to valuations methods. The three levels of inputs are:
|
Level 1 - |
Unadjusted quoted prices in active markets for identical assets or liabilities that the Funds have the ability to access. |
|
Level 2 - |
Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
|
Level 3 - |
Unobservable inputs for the asset or liability, to the extent relevant inputs are not available; representing the Funds' own assumptions about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
51
Vident ETFs
NOTES TO FINANCIAL STATEMENTS
February 29, 2024 (Unaudited) (Continued)
The availability of observable inputs can vary from security to security and is affected by a wide variety of factors, including, for example, the type of security, whether the security is new and not yet established in the marketplace, the liquidity of markets, and other characteristics particular to the security. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3.
The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety, is determined based on the lowest level input that is significant to the fair value measurement in its entirety.
The following is a summary of the inputs used to value the Funds' investments as of the end of the current fiscal period:
Vident International Equity Strategy ETFTM
|
Assets^ |
Level 1 |
Level 2 |
Level 3 |
Total |
||||||||||||
|
Common Stocks |
$ | 369,690,816 | $ | - | $ | 0 | $ | 369,690,816 | ||||||||
|
Preferred Stocks |
5,343,432 | - | - | 5,343,432 | ||||||||||||
|
Short-Term Investments |
2,024,629 | - | - | 2,024,629 | ||||||||||||
|
Total Investments in Securities |
$ | 377,058,877 | $ | - | $ | 0 | $ | 377,058,877 |
|
^ |
See Schedule of Investments for breakout of investments by country. |
Vident U.S. Equity Strategy ETFTM
|
Assets^ |
Level 1 |
Level 2 |
Level 3 |
Total |
||||||||||||
|
Common Stocks |
$ | 565,526,336 | $ | - | $ | - | $ | 565,526,336 | ||||||||
|
Short-Term Investments |
1,268,307 | - | - | 1,268,307 | ||||||||||||
|
Total Investments in Securities |
$ | 566,794,643 | $ | - | $ | - | $ | 566,794,643 |
|
^ |
See Schedule of Investments for breakout of investments by sector classification. |
52
Vident ETFs
NOTES TO FINANCIAL STATEMENTS
February 29, 2024 (Unaudited) (Continued)
Vident U.S. Bond Strategy ETFTM
|
Description^ |
Level 1 |
Level 2 |
Level 3 |
Total |
||||||||||||
|
Corporate Bonds |
$ | - | $ | 101,628,741 | $ | - | $ | 101,628,741 | ||||||||
|
Mortgage Backed Securities - U.S. Government Agency |
- | 40,859,782 | - | 40,859,782 | ||||||||||||
|
U.S. Government Agency Issues |
- | 12,332,606 | - | 12,332,606 | ||||||||||||
|
U.S. Government Notes/Bonds |
- | 253,741,387 | - | 253,741,387 | ||||||||||||
|
Short-Term Investments |
31,512,050 | - | - | 31,512,050 | ||||||||||||
|
Total Investments in Securities |
$ | 31,512,050 | $ | 408,562,516 | $ | - | $ | 440,074,566 |
|
^ |
See Schedule of Investments for further disaggregation of investment categories. |
During the current fiscal period, the Funds did not recognize any transfers into or out of Level 3.
|
B. |
Foreign Currency. Investment securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of investment securities and income and expense items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Funds do not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments and currency gains or losses realized between the trade and settlement dates on securities transactions from the fluctuations arising from changes in market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss from investments. The Funds report net realized foreign exchange gains or losses that arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on foreign currency transactions, and the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Funds' books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in the values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
53
Vident ETFs
NOTES TO FINANCIAL STATEMENTS
February 29, 2024 (Unaudited) (Continued)
|
C. |
Securities Purchased or Sold on a Forward-Commitment Basis. Vident U.S. Bond Strategy ETFTM may enter into TBA commitments, Mortgage Dollar Roll Transactions or other purchase and sale transactions that specify forward delivery of a financial security. TBA commitments are forward agreements for the purchase or sale of mortgage-backed pass-through securities for a fixed price, with payment and delivery on an agreed upon future settlement date. Most commitments in mortgage-backed pass-through securities occur for future delivery in which the exact mortgage pools to be delivered are not specified until a few days prior to settlement. The specific securities to be delivered are not identified at the trade date. However, delivered securities must follow general trade parameters, including issuer, rate and mortgage terms. When entering into TBA commitments, the Fund may take possession of or deliver the underlying mortgage-backed pass-through securities but can extend the settlement or roll the transaction. In order to better define contractual rights and to secure rights that will help the Fund mitigate counterparty risk, TBA commitments may be entered into by a Fund under Master Securities Forward Transaction Agreements (each, an "MSFTA"). An MSFTA typically contains, among other things, collateral posting terms and netting provisions in the event of default and/or termination event. The collateral requirements are typically calculated by netting the mark-to-market amount for each transaction under such agreement and comparing that amount to the value of the collateral currently pledged by a Fund and the counterparty. Cash collateral that has been pledged to cover the obligations of the Trust or cash collateral received from the counterparty, if any, is reported separately on the Statements of Assets and Liabilities as cash held as collateral for TBA commitments or cash received as collateral for TBA commitments, respectively. Noncash collateral pledged by the Fund, if any, is noted in the Schedule of Investments. In connection with this ability, the Fund may enter into mortgage "dollar rolls" in which a Fund sells TBA mortgage-backed securities and simultaneously contracts to repurchase substantially similar (i.e., same type, coupon and maturity) securities on a specific future date at an agreed upon price. During the period between the sale and repurchase, a Fund is not entitled to receive interest and principal payments on the securities sold. Mortgage dollar roll transactions are treated as purchases and sales and the Fund realizes gains and losses on these transactions. |
The value of TBA commitments on the Statement of Assets and Liabilities for the Vident U.S. Bond Strategy ETFTM as of the end of the current fiscal period is as follows:
54
Vident ETFs
NOTES TO FINANCIAL STATEMENTS
February 29, 2024 (Unaudited) (Continued)
Statement of Assets and Liabilities - Values of TBA Commitments as of the end of the current fiscal period
|
Asset |
|||||
|
Location |
Value |
||||
|
TBA Commitments - Credit/interest rate risk |
Investments in securities, at value |
$ | 31,719,845 |
|
Liabilities |
|||||
|
Location |
Value |
||||
|
TBA Commitments - Credit/interest rate risk |
Payable for Securities Purchased |
$ | 31,839,696 |
The effect of TBA Commitments on the Statement of Operations for the current fiscal period
|
Amount of Realized Gain |
Change in Unrealized |
||||||||||||
|
Investments |
Investments |
||||||||||||
|
TBA Commitments |
($156,103 | ) |
TBA Commitments |
$ | (100,604 | ) |
The average monthly value of TBA Commitments during the current fiscal period was $29,893,452.
OFFSETTING ASSETS AND LIABILITIES
The Vident U.S. Bond Strategy ETFTM is subject to various MSFTAs, which govern the terms of certain transactions with select counterparties. The MSFTAs allow the Fund to close out and net its total exposure to a counterparty in the event of a default with respect to all the transactions governed under a single agreement with a counterparty. The MSFTAs also specify collateral posting arrangements at prearranged exposure levels. Under the MSFTAs, collateral is routinely transferred if the total net exposure to certain transactions (net of existing collateral already in place) governed under the relevant MSFTAs with a counterparty in a given account exceeds a specified threshold depending on the counterparty and type of MSFTAs.
55
Vident ETFs
NOTES TO FINANCIAL STATEMENTS
February 29, 2024 (Unaudited) (Continued)
The following is a summary of the Assets and Liabilities subject to offsetting in the Fund as of the end of the current fiscal period.
OFFSETTING ASSETS AND LIABILITIES
|
Liabilities |
||||||||||||
|
Description/Counterparty |
Gross |
Gross |
Net |
|||||||||
|
TBA Commitments |
||||||||||||
|
Goldman Sachs & Co. LLC |
$ | 11,608,107 | $ | - | $ | 11,608,107 | ||||||
|
Wells Fargo Securities, LLC |
20,231,589 | - | 20,231,589 | |||||||||
| $ | 31,839,696 | $ | - | $ | 31,839,696 |
|
Gross Amounts not |
||||||||||||
|
Description/Counterparty |
Financial |
Collateral |
Net Amount |
|||||||||
|
TBA Commitments |
||||||||||||
|
Goldman Sachs & Co. LLC |
$ | (10,698,107 | ) | $ | (910,000 | ) | $ | - | ||||
|
Wells Fargo Securities, LLC |
(19,431,589 | ) | (800,000 | ) | - | |||||||
| $ | (30,129,696 | ) | $ | (1,710,000 | ) | $ | - |
In some instances, the collateral amounts disclosed in the tables were adjusted due to the requirement to limit the collateral amounts to avoid the effect of overcollateralization. Actual collateral received/pledged may be more than the amounts disclosed herein.
Federal Income Taxes. The Funds' policy is to comply with the provisions of Subchapter M of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies and to distribute substantially all of their net investment income and net capital gains to shareholders. Therefore, no federal income tax provision is required. Each Fund plans to file U.S. Federal and various state and local tax returns.
56
Vident ETFs
NOTES TO FINANCIAL STATEMENTS
February 29, 2024 (Unaudited) (Continued)
Each Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed each Fund's uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months. Income and capital gain distributions are determined in accordance with federal income tax regulations, which may differ from U.S. GAAP. The Funds recognize interest and penalties, if any, related to unrecognized tax benefits on uncertain tax positions as income tax expenses in the Statements of Operations. During the current fiscal period, the Funds did not incur any interest or penalties.
|
D. |
Security Transactions and Investment Income. Investment securities transactions are accounted for on the trade date. Gains and losses realized from sales of securities are determined on a specific identification basis. Dividend income is recorded on the ex-dividend date. Non-cash dividends included in dividend income or separately disclosed, if any, are recorded at fair value of the security received. Withholding taxes on foreign dividends and foreign taxes on capital gains have been provided for in accordance with the Funds' understanding of the applicable tax rules and regulations. Interest income is recorded on an accrual basis. Discounts and premiums on securities purchased are accreted and amortized using the effective yield method. Paydown gains and losses on mortgage-related and other asset-backed securities are recorded as components of interest income on the Statements of Operations. |
Distributions received from the Funds' investments in real estate investment trusts ("REIT") may be characterized as ordinary income, net capital gain, or a return of capital. The proper characterization of REIT distributions is generally not known until after the end of each calendar year. As such, the Funds must use estimates in reporting the character of their income and distributions received during the current calendar year for financial statement purposes. The actual character of distributions to the Funds' shareholders will be reflected on the Form 1099 received by shareholders after the end of the calendar year. Due to the nature of REIT investments, a portion of the distributions received by a Fund's shareholders may represent a return of capital.
57
Vident ETFs
NOTES TO FINANCIAL STATEMENTS
February 29, 2024 (Unaudited) (Continued)
|
E. |
Distributions to Shareholders. Distributions to shareholders from net investment income for the Funds are declared and paid at least on a quarterly basis and distributions from net realized gains on securities are normally declared and paid on an annual basis. Distributions are recorded on the ex-dividend date. |
|
F. |
Use of Estimates. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the current fiscal period. Actual results could differ from those estimates. |
|
G. |
Share Valuation. The NAV per share of each Fund is calculated by dividing the sum of the value of the securities held by the Fund, plus cash and other assets, minus all liabilities (including estimated accrued expenses) by the total number of shares outstanding for the Fund, rounded to the nearest cent. The Funds' shares will not be priced on the days on which the New York Stock Exchange, Inc. ("NYSE") is closed for trading. The offering and redemption price per share for each Fund is equal to the Fund's NAV per share. |
|
H. |
Guarantees and Indemnifications. In the normal course of business, the Funds enter into contracts with service providers that contain general indemnification clauses. Each Fund's maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Funds that have not yet occurred. However, based on experience, the Funds expect the risk of loss to be remote. |
|
I. |
Reclassification of Capital Accounts. U.S. GAAP requires that certain components of net assets relating to permanent differences be reclassified between financial and tax reporting. These reclassifications have no effect on net assets or NAV per share. The permanent differences are primarily due to differing book and tax treatments for in-kind transactions. For the fiscal year ended August 31, 2023 the following table shows the reclassifications made: |
|
Distributable |
Paid-In Capital |
|||||||
|
Vident International Equity Strategy ETFTM |
$ | (290,792 | ) | $ | 290,792 | |||
|
Vident U.S. Equity Strategy ETFTM |
(56,264,687 | ) | 56,264,687 | |||||
|
Vident U.S. Bond Strategy ETFTM |
4,577 | (4,577 | ) |
58
Vident ETFs
NOTES TO FINANCIAL STATEMENTS
February 29, 2024 (Unaudited) (Continued)
|
J. |
Subsequent Events. In preparing these financial statements, management has evaluated events and transactions for potential recognition or disclosure through the date the financial statements were issued. There were no events or transactions that occurred during the period subsequent to the end of the current fiscal period that materially impacted the amounts or disclosures in the Funds' Financial Statements. |
NOTE 3 - COMMITMENTS AND OTHER RELATED PARTY TRANSACTIONS
Vident Advisory, LLC, doing business as Vident Asset Management (the "Adviser") serves as the investment adviser and index provider to the Funds. Pursuant to an Investment Advisory Agreement ("Advisory Agreement") between the Trust, on behalf of the Funds, and the Adviser, the Adviser provides investment advice to the Funds and oversees the day-to-day operations of the Funds, subject to the direction and control of the Board and the officers of the Trust. Under the Advisory Agreement, the Adviser has agreed to pay all expenses incurred by the Funds except for the fee paid to the Adviser pursuant to this Agreement, interest charges on any borrowings, dividends and other expenses on securities sold short, taxes, brokerage commissions and other expenses incurred in placing orders for the purchase and sale of securities and other investment instruments, acquired fund fees and expenses, accrued deferred tax liability, extraordinary expenses, and distribution fees and expenses paid by the Trust under any distribution plan adopted pursuant to Rule 12b-1 under the 1940 Act (collectively, "Excluded Expenses"). For services provided to the Funds, Vident International Equity Strategy ETFTM pays the Adviser 0.61%, Vident U.S. Equity Strategy ETFTM pays the Adviser 0.50%, and Vident U.S. Bond Strategy ETFTM pays the Adviser 0.41% at an annual rate based on each Fund's average daily net assets.
U.S. Bancorp Fund Services, LLC ("Fund Services" or "Administrator"), doing business as U.S. Bank Global Fund Services, acts as the Funds' Administrator and, in that capacity, performs various administrative and accounting services for the Funds. The Administrator prepares various federal and state regulatory filings, reports and returns for the Funds, including regulatory compliance monitoring and financial reporting; prepares reports and materials to be supplied to the Board; monitors the activities of the Funds' Custodian, transfer agent and accountants. Fund Services also serves as the transfer agent and fund accountant to the Funds. U.S. Bank N.A. (the "Custodian"), an affiliate of Fund Services, serves as the Funds' Custodian.
ALPS Distributors, Inc. (the "Distributor") acts as the Funds' principal underwriter in a continuous public offering of the Funds' shares.
All officers of the Trust are affiliated with the Administrator and Custodian.
59
Vident ETFs
NOTES TO FINANCIAL STATEMENTS
February 29, 2024 (Unaudited) (Continued)
NOTE 4 - PURCHASES AND SALES OF SECURITIES
During the current fiscal period, purchases and sales of securities by the Funds, excluding short-term securities and in-kind transactions, were as follows:
|
Purchases |
Sales |
|||||||
|
Vident International Equity Strategy ETFTM |
$ | 113,071,225 | $ | 118,492,179 | ||||
|
Vident U.S. Equity Strategy ETFTM |
$ | 154,191,252 | $ | 155,315,376 | ||||
|
Vident U.S. Bond Strategy ETFTM |
$ | 397,539,484 | $ | 397,250,295 |
During the current fiscal period, in-kind transactions associated with creations and redemptions were as follows:
|
In-Kind Purchases |
In-Kind Sales |
|||||||
|
Vident International Equity Strategy ETFTM |
$ | 1,573,911 | $ | 3,248,888 | ||||
|
Vident U.S. Equity Strategy ETFTM |
$ | 82,435,598 | $ | 106,857,646 | ||||
|
Vident U.S. Bond Strategy ETFTM |
$ | 30,534,636 | $ | 15,290,842 |
There were no purchases or sales of U.S. Government securities in Vident International Equity Strategy ETFTM or Vident U.S. Equity Strategy ETFTM during the current fiscal period. Included in the amounts for Vident U.S. Bond Strategy ETFTM there were $218,834,077 of purchases and $206,982,759 of sales of U.S. Government securities during the current fiscal period.
NOTE 5 - INCOME TAX INFORMATION
The amount and tax character of tax basis distributions and composition of net assets, including distributable earnings (accumulated deficit) are finalized at fiscal year-end; accordingly, tax basis balances have not been determined for the current fiscal period.
60
Vident ETFs
NOTES TO FINANCIAL STATEMENTS
February 29, 2024 (Unaudited) (Continued)
The components of distributable earnings (accumulated deficit) and cost basis of investments and net unrealized appreciation (depreciation) for federal income tax purposes as of August 31, 2023, were as follows:
|
Vident |
Vident |
Vident |
||||||||||
|
Tax cost of Investments |
$ | 370,245,335 | $ | 492,515,169 | $ | 429,933,833 | ||||||
|
Gross tax unrealized appreciation |
$ | 29,001,249 | $ | 51,376,843 | $ | 1,264,348 | ||||||
|
Gross tax unrealized depreciation |
(37,861,469 | ) | (4,236,048 | ) | (18,618,810 | ) | ||||||
|
Net tax unrealized appreciation/(depreciation) |
(8,860,220 | ) | 47,140,795 | (17,354,462 | ) | |||||||
|
Undistributed ordinary income |
4,174,098 | 1,318,947 | 770,110 | |||||||||
|
Undistributed long-term capital gain |
- | - | - | |||||||||
|
Other accumulated gain (loss) |
(154,386,649 | ) | (29,727,095 | ) | (49,085,108 | ) | ||||||
|
Distributable earnings/(accumulated deficit) |
$ | (159,072,771 | ) | $ | 18,732,647 | $ | (65,669,460 | ) |
The differences between book and tax-basis cost are attributable to the realization for tax purposes of unrealized gains on investments in passive foreign investment companies and wash sales. A regulated investment company may elect for any taxable year to treat any portion of any qualified late year loss as arising on the first day of the next taxable year. Qualified late year losses are certain capital and ordinary losses which occur during the portion of the Funds' taxable year subsequent to October 31 and December 31, respectively. For the taxable year ended August 31, 2023, the Funds did not elect to defer any post- October capital losses or late-year ordinary losses.
As of August 31, 2023, the Funds had the following capital loss carryforwards available for federal income tax purposes, with an indefinite expiration:
|
Short-Term |
Long-Term |
|||||||
|
Vident International Equity Strategy ETFTM |
$ | (134,849,453 | ) | $ | (19,523,526 | ) | ||
|
Vident U.S. Equity Strategy ETFTM |
$ | (29,727,095 | ) | $ | - | |||
|
Vident U.S. Bond Strategy ETFTM |
$ | (28,633,806 | ) | $ | (20,451,302 | ) |
61
Vident ETFs
NOTES TO FINANCIAL STATEMENTS
February 29, 2024 (Unaudited) (Continued)
During the fiscal year ended August 31, 2023, the Funds utilized the following capital loss carryforwards that were available as of August 31, 2022:
|
Short-Term |
Long-Term |
|||||||
|
Vident International Equity Strategy ETFTM |
$ | - | $ | - | ||||
|
Vident U.S. Equity Strategy ETFTM |
$ | 2,775,996 | $ | - | ||||
|
Vident U.S. Bond Strategy ETFTM |
$ | - | $ | - |
The tax character of distributions paid by the Funds during the fiscal year ended August 31, 2023, was as follows:
|
Ordinary Income |
Capital Gains |
|||||||
|
Vident International Equity Strategy ETFTM |
$ | 17,386,128 | $ | - | ||||
|
Vident U.S. Equity Strategy ETFTM |
$ | 7,553,684 | $ | - | ||||
|
Vident U.S. Bond Strategy ETFTM |
$ | 13,499,504 | $ | - |
The tax character of distributions paid by the Funds during the fiscal year ended August 31, 2022, was as follows:
|
Ordinary Income |
Capital Gains |
|||||||
|
Vident International Equity Strategy ETFTM |
$ | 23,767,573 | $ | - | ||||
|
Vident U.S. Equity Strategy ETFTM |
$ | 6,205,670 | $ | - | ||||
|
Vident U.S. Bond Strategy ETFTM |
$ | 8,604,885 | $ | 800,974 |
NOTE 6 - SHARE TRANSACTIONS
Shares of the Funds are listed and traded on New York Stock Exchange Arca, Inc. ("NYSE Arca"). Market prices for the shares may be different from their NAV. The Funds issue and redeem shares on a continuous basis at NAV generally in large blocks called "Creation Units." Creation Units are issued and redeemed principally in-kind for securities included in a specified universe. Once created, shares generally trade in the secondary market at market prices that change throughout the day. Except when aggregated in Creation Units, shares are not redeemable securities of a Fund. Creation Units of a Fund may only be purchased or redeemed by certain financial institutions ("Authorized Participants"). An Authorized Participant is either (i) a broker-dealer or other participant in the clearing process through the Continuous Net Settlement System of the National Securities Clearing Corporation or (ii) a Depository Trust Company participant and, in each case, must have executed a Participant Agreement with the Distributor. Most retail investors do not qualify as Authorized Participants nor have the resources to buy and sell whole Creation Units.
62
Vident ETFs
NOTES TO FINANCIAL STATEMENTS
February 29, 2024 (Unaudited) (Continued)
Therefore, they are unable to purchase or redeem the shares directly from a Fund. Rather, most retail investors may purchase shares in the secondary market with the assistance of a broker and are subject to customary brokerage commissions or fees.
The Funds each currently offer one class of shares, which have no front-end sales loads, no deferred sales charges, and no redemption fees. A fixed transaction fee is imposed for the transfer and other transaction costs associated with the purchase or sale of Creation Units. Vident International Equity Strategy ETFTM charges $5,000; Vident U.S. Equity Strategy ETFTM and Vident U.S. Bond Strategy ETFTM each charge $750 for the standard fixed transaction fee, payable to the Custodian. The fixed transaction fee may be waived on transaction orders if the Funds' Custodian has determined to waive some or all of the costs associated with the order, or another party, such as the Adviser, has agreed to pay such fee. In addition, a variable fee payable to each Fund may be charged on all cash transactions or substitutes for Creation Units of up to a maximum of 2% in Vident International Equity Strategy ETFTM and Vident U.S. Equity Strategy ETFTM and up to a maximum of 3% in Vident U.S. Bond Strategy ETFTM as a percentage of the value of the Creation Units subject to the transaction.
Variable fees are imposed to compensate the Funds for the transaction costs associated with the cash transactions fees. Variable fees received by each Fund, if any, are displayed in the Capital Share Transactions sections of the Statements of Changes in Net Assets. Each Fund may issue an unlimited number of shares of beneficial interest, with no par value. Shares of each Fund have equal rights and privileges.
NOTE 7 - RISKS
Sector Risk. To the extent the Fund invests more heavily in particular sectors of the economy, its performance will be especially sensitive to developments that significantly affect those sectors.
Russia/Ukraine Conflict Risk (Vident International Equity Strategy ETFTM Only). On February 24, 2022, Russia commenced a military attack on Ukraine. The outbreak of hostilities between the two countries could result in more widespread conflict and could have a severe adverse effect on the region and the markets. In addition, sanctions imposed on Russia by the United States and other countries, and any sanctions imposed in the future could have a significant adverse impact on the Russian economy and related markets. The price and liquidity of investments may fluctuate widely as a result of the conflict and related events. How long such conflict and related events will last and whether it will escalate further cannot be predicted, nor its effect on the Fund.
63
Vident ETFs
NOTES TO FINANCIAL STATEMENTS
February 29, 2024 (Unaudited) (Continued)
NOTE 8 - BENEFICIAL OWNERSHIP
The beneficial ownership, either directly or indirectly, of 25% or more of the voting securities of a fund creates a presumption of control of a fund, under section 2(a)(9) of the 1940 Act. As of the end of the current fiscal period, Blue Trust, Inc., as a beneficial shareholder, owned greater than 25% of the outstanding shares of each Fund.
64
Vident ETFs
Expense Examples
For the Six-Months Ended February 29, 2024 (Unaudited)
As a shareholder of the Funds, you incur two types of costs: (1) transaction costs, including brokerage commissions on purchases and sales of Fund shares, and (2) ongoing costs, including management fees and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire six-month period as indicated in the following Expense Example tables.
Actual Expenses
The first line of the table provides information about actual account values based on actual returns and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then, multiply the result by the number in the first line under the heading entitled "Expenses Paid During the Period'' to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line of the table provides information about hypothetical account values based on a hypothetical return and hypothetical expenses based on the Funds' actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Funds' actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Funds and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as brokerage commissions paid on purchases and sales of Fund shares. Therefore, the second line of the table is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. If these transactional costs were included, your costs would have been higher.
65
Vident ETFs
Expense Examples
For the Six-Months Ended February 29, 2024 (Unaudited) (Continued)
Vident International Equity Strategy ETFTM
|
Beginning |
Ending |
Expenses |
|
|
Actual |
$ 1,000.00 |
$ 1070.40 |
$3.14 |
|
Hypothetical (5% annual return before expenses) |
$ 1,000.00 |
$ 1,021.83 |
$3.07 |
Vident U.S. Equity Strategy ETFTM
|
Beginning |
Ending |
Expenses |
|
|
Actual |
$ 1,000.00 |
$ 1,106.30 |
$2.62 |
|
Hypothetical (5% annual return before expenses) |
$ 1,000.00 |
$ 1,022.38 |
$2.51 |
Vident U.S. Bond Strategy ETFTM
|
Beginning |
Ending |
Expenses |
|
|
Actual |
$ 1,000.00 |
$ 1,039.90 |
$2.08 |
|
Hypothetical (5% annual return before expenses) |
$ 1,000.00 |
$ 1,022.82 |
$2.06 |
|
(1) |
The dollar amounts shown as expenses paid during the period are equal to the annualized expense ratio, 0.61%, multiplied by the average account value during the six-month period, multiplied by 182/366, to reflect the one-half year period. |
|
(2) |
The dollar amounts shown as expenses paid during the period are equal to the annualized expense ratio, 0.50%, multiplied by the average account value during the six-month period, multiplied by 182/366, to reflect the one-half year period. |
|
(3) |
The dollar amounts shown as expenses paid during the period are equal to the annualized expense ratio, 0.41%, multiplied by the average account value during the six-month period, multiplied by 182/366, to reflect the one-half year period. |
66
Vident ETFs
Review of Liquidity Risk Management Program
(Unaudited)
Pursuant to Rule 22e-4 under the Investment Company Act of 1940, the Trust, on behalf of the series of the Trust covered by this shareholder report (the "Series"), has adopted a liquidity risk management program to govern the Trust's approach to managing liquidity risk. Rule 22e-4 seeks to promote effective liquidity risk management, thereby reducing the risk that a fund will be unable to meet its redemption obligations and mitigating dilution of the interests of fund shareholders. The Trust's liquidity risk management program is tailored to reflect the Series' particular risks, but not to eliminate all adverse impacts of liquidity risk, which would be incompatible with the nature of such Series.
The investment adviser to the Series has adopted and implemented its own written liquidity risk management program (the "Program") tailored specifically to assess and manage the liquidity risk of the Series.
At a recent meeting of the Board of Trustees of the Trust, the Trustees received a report pertaining to the operation, adequacy, and effectiveness of implementation of the Program for the period ended December 31, 2023. The report concluded that the Program is reasonably designed to assess and manage the Series' liquidity risk and has operated adequately and effectively to manage such risk. The report reflected that there were no liquidity events that impacted the Series' ability to timely meet redemptions without dilution to existing shareholders. The report further noted that no material changes have been made to the Program since its implementation.
There can be no assurance that the Program will achieve its objectives in the future. Please refer to the prospectus for more information regarding the Series' exposure to liquidity risk and other principal risks to which an investment in the Series may be subject.
67
Vident ETFs
Federal Tax Information
(Unaudited)
QUALIFIED DIVIDEND INCOME
For the fiscal year ended August 31, 2023, certain dividends paid by the Funds may be subject to a maximum tax rate of 23.8%, as provided for by the Jobs and Growth Tax Relief Reconciliation Act of 2003. The percentage of dividends declared from ordinary income designated as qualified dividend income was as follows:
|
Vident International Equity Strategy ETFTM |
69.99% |
|
Vident U.S. Equity Strategy ETFTM |
100.00% |
|
Vident U.S. Bond Strategy ETFTM |
0% |
DIVIDENDS RECEIVED DEDUCTION
For corporate shareholders, the percent of ordinary income distributions qualifying for the corporate dividends received deduction for the fiscal year ended August 31, 2023 was as follows:
|
Vident International Equity Strategy ETFTM |
0.02% |
|
Vident U.S. Equity Strategy ETFTM |
100.00% |
|
Vident U.S. Bond Strategy ETFTM |
0.00% |
SHORT-TERM CAPITAL GAIN
For the fiscal year ended August 31, 2023, the percentage of taxable ordinary income distributions that are designated as short-term capital gain distributions under Internal Revenue Section 871(k)(2)(C) for each Fund were as follows:
|
Vident International Equity Strategy ETFTM |
0.00% |
|
Vident U.S. Equity Strategy ETFTM |
0.00% |
|
Vident U.S. Bond Strategy ETFTM |
0.00% |
68
Vident ETFs
Federal Tax Information
(Unaudited) (Continued)
FOREIGN TAX CREDIT PASS THROUGH
Pursuant to Section 853 of the Internal Revenue code, the Funds designated the following amounts as foreign taxes paid for the fiscal year ended August 31, 2023. Foreign taxes paid for purposes of Section 853 may be less than actual foreign taxes paid for financial statement purposes.
|
Creditable |
Per Share |
Portion of |
|
|
Vident International Equity Strategy ETFTM |
$2,523,506 |
$0.16073288 |
100.00% |
|
Vident U.S. Equity Strategy ETFTM |
- |
- |
- |
|
Vident U.S. Bond Strategy ETFTM |
- |
- |
- |
Foreign taxes paid or withheld should be included in taxable income with an offsetting deduction from gross income or as a credit for taxes paid to foreign governments.
Above figures may differ from those cited elsewhere in this report due to difference in the calculation of income and gains under GAAP purposes and Internal Revenue Service purposes.
Shareholders are strongly advised to consult their own tax advisers with respect to the tax consequences of their investments in the Funds.
Information About Portfolio Holdings
(Unaudited)
The Funds file their complete schedules of portfolio holdings for their first and third fiscal quarters with the SEC on Part F of Form N-PORT. The Funds' Part F of Form N-PORT is available without charge, upon request, by calling toll-free at (800) 617-0004. Furthermore, you may obtain the Part F of Form N-PORT on the SEC's website at www.sec.gov. Each Fund's portfolio holdings are posted on their website at www.videntam.com daily.
69
Vident ETFs
Information About Proxy Voting
(Unaudited)
A description of the policies and procedures the Funds use to determine how to vote proxies relating to portfolio securities is provided in the Statement of Additonal Information ("SAI"). The SAI is available without charge, upon request, by calling toll-free at (800) 617-0004, by accessing the SEC's website at www.sec.gov, or by accessing the website at www.videntam.com.
Information regarding how the Funds voted proxies relating to portfolio securities during the period ending June 30 is available by calling toll-free at (800) 617-0004 or by accessing the SEC's website at www.sec.gov.
Information About the Funds' Trustees
(Unaudited)
The SAI includes additional Information about the Funds' Trustees and is available without charge, upon request, by calling (800) 617-0004 or by accessing the SEC's website at www.sec.gov or by accessing the Funds' website at www.videntam.com.
Frequency Distribution of Premiums and Discounts
(Unaudited)
Information regarding how often shares of the Funds trade on the exchange at a price above (i.e., at a premium) or below (i.e., at a discount) the NAV of the Funds is available, without charge, on the Funds' website at www.videntam.com.
70
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Adviser/Index Provider
Vident Asset Management
1125 Sanctuary Parkway, Suite 515
Alpharetta, Georgia 30009
Distributor
ALPS Distributors, Inc.
1290 Broadway, Suite 1000
Denver, Colorado 80203
Custodian
U.S. Bank National Association
1555 North Rivercenter Drive, Suite 302
Milwaukee, Wisconsin 53212
Transfer Agent
U.S. Bancorp Fund Services, LLC
615 East Michigan Street
Milwaukee, Wisconsin 53202
Independent Registered Public Accounting Firm
Cohen & Company, Ltd.
342 North Water Street, Suite 830
Milwaukee, Wisconsin 53202
Legal Counsel
Morgan, Lewis & Bockius LLP
1111 Pennsylvania Avenue NW
Washington, DC 20004-2541
|
Vident International
Symbol - VIDI |
Vident U.S. Equity
Symbol - VUSE |
Vident U.S. Bond
Symbol - VBND |
| (b) | Not applicable. |
Item 2. Code of Ethics.
Not applicable for semi-annual reports.
Item 3. Audit Committee Financial Expert.
Not applicable for semi-annual reports.
Item 4. Principal Accountant Fees and Services.
Not applicable for semi-annual reports.
Item 5. Audit Committee of Listed Registrants.
Not applicable for semi-annual reports.
Item 6. Investments.
| (a) | Schedule of Investments is included as part of the report to shareholders filed under Item 1 of this Form. |
| (b) | Not applicable. |
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable to open-end investment companies.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable to open-end investment companies.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not applicable to open-end investment companies.
Item 10. Submission of Matters to a Vote of Security Holders.
There have been no material changes to the procedures by which shareholders may recommend nominees to the registrant's board of trustees.
Item 11. Controls and Procedures.
| (a) | The Registrant's President (principal executive officer) and Treasurer (principal financial officer) have reviewed the Registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the "Act")) as of a date within 90 days of the filing of this report, as required by Rule 30a-3(b) under the Act and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934. Based on their review, such officers have concluded that the disclosure controls and procedures are effective in ensuring that information required to be disclosed in this report is appropriately recorded, processed, summarized and reported and made known to them by others within the Registrant and by the Registrant's service provider. |
| (b) | There were no changes in the Registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Registrant's internal control over financial reporting. |
Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.
Not applicable to open-end investment companies.
Item 13. Exhibits.
| (a) | (1) Any code of ethics or amendment thereto, that is the subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy Item 2 requirements through filing an exhibit. Not Applicable. |
(2) A separate certification for each principal executive officer and principal financial officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.
(3) Any written solicitation to purchase securities under Rule 23c-1 under the Act sent or given during the period covered by the report by or on behalf of the registrant to 10 or more persons. Not applicable to open-end investment companies.
(4) Change in the registrant's independent public accountant. There was no change in the registrant's independent public accountant for the period covered by this report.
| (b) | Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Furnished herewith. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| (Registrant) | ETF Series Solutions | ||
| By (Signature and Title)* | /s/ Kristina R. Nelson | ||
| Kristina R. Nelson, President (principal executive officer) | |||
| Date | 5/7/2024 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| By (Signature and Title)* | /s/ Kristina R. Nelson | ||
| Kristina R. Nelson, President (principal executive officer) | |||
| Date | 5/7/2024 | ||
| By (Signature and Title)* | /s/ Kristen M. Weitzel | ||
| Kristen M. Weitzel, Treasurer (principal financial officer) | |||
| Date | 5/7/2024 |
| * | Print the name and title of each signing officer under his or her signature. |