DRAL is an actively managed ETF that seeks daily investment results, before fees and expenses, of 200% (2X) of the daily percentage change in the share price of DRAM, the underlying ETF, for a single trading day. It pursues that exposure primarily through swap agreements and listed options contracts, rebalancing daily.
The Fund is designed to deliver 200% (2X) of the daily price performance of DRAM, before fees and expenses. With DRAL now available for trading, active traders can take amplified, single-ticker positions on the semiconductor memory theme that sits at the center of the artificial intelligence buildout. Defiance specializes in thematic, income, and leveraged ETFs and continues to expand the tools it offers active traders for tactical, high-conviction positioning.
For full fund details, the prospectus, holdings, and performance current to the most recent month-end, visit defianceetfs.com/dral or call 833.333.9383.
Investing in the Fund is not equivalent to investing directly in DRAM. The Fund is not suitable for all investors. The Fund is designed to be utilized only by knowledgeable investors who understand the potential consequences of seeking daily leveraged (2X) investment results, understand the risks associated with the use of leverage, and are willing to monitor their portfolios frequently. The Fund is not intended to be used by, and is not appropriate for, investors who do not intend to actively monitor and manage their portfolios. The Fund pursues daily leveraged investment objectives, which means it is riskier than alternatives that do not use leverage. The Fund magnifies the performance of DRAM (the “Underlying ETF”) and is designed strictly for short-term use. For periods longer than a single day, the Fund’s performance will be the result of compounded daily returns, which is very likely to differ from 200% of the return of the Underlying ETF over the same period. It is possible that investors could lose their entire principal within a single trading day.About Defiance ETFsFounded in 2018, Defiance is a leading ETF issuer specializing in thematic, income, and leveraged ETFs. Our leveraged single-stock ETFs empower investors to take amplified positions in high-growth companies, providing precise leverage exposure without the need to open a margin account.
Media Contact: Brenda Hentschel | bhentschel@gregoryagency.com | 201.705.3758
IMPORTANT DISCLOSURESDefiance ETFs LLC is the ETF sponsor. The Fund’s investment adviser is Tidal Investments, LLC (“Tidal” or the “Adviser”).
The Fund’s investment objectives, risks, charges, and expenses must be considered carefully before investing. The prospectus and summary prospectus contain this and other important information about the investment company. Please read the prospectus and/or summary prospectus carefully before investing. For a prospectus or summary prospectus with this and other information, go to defianceetfs.com. Hard copies can be requested by calling 833.333.9383.Investing involves risk. Principal loss is possible. As an ETF, the Fund may trade at a premium or discount to NAV. Shares are bought and sold at market price (not NAV) and are not individually redeemed from the Fund. There is no guarantee the Fund’s strategy will be properly implemented, and an investor may lose some or all of its investment.
DRAM Price Decline Risk. As part of the Fund’s leveraged investment strategy, the Fund enters into swap agreements and options contracts based on the share price of DRAM (the “Underlying ETF”). This strategy subjects the Fund to certain of the same risks as if it owned shares of the Underlying ETF, even though it does not. By virtue of the Fund’s indirect 2X exposure to changes in the share price of the Underlying ETF, the Fund is subject to the risk that the Underlying ETF’s share price
declines. If the share price of the Underlying ETF decreases, the Fund will likely lose value and, as a result, the Fund may suffer significant losses. The Fund may also be subject to the following risks:
Indirect Investment in the Underlying ETF Risk. The Roundhill Memory ETF, its investment adviser, Roundhill Financial Inc., and its sponsor are not affiliated with the Trust, the Fund, the Adviser, or their respective affiliates, and are not involved with this offering in any way. The Roundhill Memory ETF has no obligation to consider the Fund or its shareholders in taking any actions that might affect the value of Fund shares. Investors in the Fund will not have voting rights or other ownership privileges associated with holding shares of the Roundhill Memory ETF. The Fund is not sponsored, endorsed, sold, or promoted by the Roundhill Memory ETF or Roundhill Financial Inc.
Underlying ETF Risk. Because the Fund seeks exposure to the Roundhill Memory ETF, it is indirectly subject to all of the risks of investing in that ETF, including the risk that the Underlying ETF fails to meet its own investment objective or does not track its underlying index. The Fund also indirectly bears its proportionate share of the Underlying ETF’s fees and expenses, which are in addition to the Fund’s own fees and expenses. The Underlying ETF may itself use derivatives and may hold a concentrated portfolio, which can increase volatility.
Memory Industry Risk. The Underlying ETF concentrates in companies engaged in the semiconductor memory industry, including high bandwidth memory (HBM), dynamic random-access memory (DRAM), and NAND flash and solid-state storage technologies. The memory market is highly cyclical and subject to rapid pricing swings, oversupply and undersupply cycles, high capital intensity, technological obsolescence, and shifts in end-market demand. A downturn in memory pricing or demand could materially and adversely affect the Underlying ETF and, in turn, the Fund’s performance.
Semiconductor Industry Risk. Semiconductor companies are significantly affected by intense competition, rapid product obsolescence, high research, development, and capital expenditure requirements, cyclical demand, and global supply chain disruptions. Export controls, tariffs, and other regulatory developments may also restrict their business activities. These factors may cause the securities held by the Underlying ETF to be volatile and may negatively affect the Fund’s performance.
Technology Sector Risk. Companies in the technology sector may be subject to greater market volatility, shorter product cycles, intense competition, and heavy dependence on intellectual property rights. A rising interest rate environment may further pressure technology valuations. These factors may adversely affect the Underlying ETF and the Fund.
Artificial Intelligence Demand Risk. Demand for memory products is increasingly tied to spending on artificial intelligence infrastructure. A slowdown in AI-related capital expenditures, a change in prevailing technology architectures, or a reassessment of AI growth expectations could reduce demand for memory products and adversely affect the Underlying ETF and the Fund’s performance.
Concentration Risk. The Fund’s exposure is concentrated in the Underlying ETF and, indirectly, in the memory and semiconductor industries. The Fund may be more sensitive to adverse developments affecting those industries than a fund that invests across a broader range of issuers and sectors.
Compounding and Market Volatility Risk. The Fund’s performance for periods greater than a trading day will be the result of each day’s returns compounded over the period, which is likely to differ from 200% of the Underlying ETF’s performance. During periods of higher volatility, compounding effects may cause the Fund to lose value even if the Underlying ETF’s share price increases over the longer term.
Daily Correlation/Tracking Risk. There is no guarantee that the Fund will achieve a high degree of leveraged correlation to the Underlying ETF. Market disruptions, volatility, or limitations in the availability of derivatives may cause the Fund’s performance to deviate from its daily leveraged investment objective.
Leverage Risk. The Fund seeks 2X long exposure through financial instruments, which exposes the Fund to the risk that losses may be magnified. Leverage increases the Fund’s volatility, and a relatively small movement in the Underlying ETF’s share price may result in significant losses for the Fund.
Derivatives Risk. The Fund’s investments in derivatives may pose risks greater than those associated with directly investing in securities. These risks include increased volatility, imperfect correlation with the Underlying ETF, liquidity constraints, valuation challenges, and the potential for losses exceeding the amount initially invested.
Counterparty Risk. The Fund is subject to counterparty risk due to its use of derivatives. If a counterparty fails to meet its contractual obligations, the Fund may experience delays or losses, which could negatively affect its performance.
Options Contracts Risk. The Fund’s use of options subjects it to additional risks, including volatility, time decay, and the possibility that options positions expire worthless, which could result in significant losses to the Fund.
Swap Agreements. The use of swap transactions is a highly specialized activity, which involves investment techniques and risks different from those associated with ordinary portfolio securities transactions.
Rebalancing Risk. If the Fund is unable to rebalance its portfolio correctly or in a timely manner, its exposure may not be consistent with its investment objective. This may increase the Fund’s risk exposure and cause its performance to diverge from its intended daily leveraged results.
Intra-Day Investment Risk. The Fund seeks investment results from the close of one trading day to the close of the next. An investor who buys Shares intra-day may receive more or less exposure to the Underlying ETF than the Fund’s stated 2X objective, depending on movements in the Underlying ETF’s share price since the prior close, and may experience returns that differ from that objective.
Liquidity Risk. Some securities or financial instruments held by the Fund may be difficult to sell, particularly during periods of market stress or volatility. Reduced liquidity may make it difficult for the Fund to adjust its exposure or meet its investment objective.
High Portfolio Turnover Risk. Daily rebalancing is expected to result in high portfolio turnover. High portfolio turnover may increase transaction costs, which could reduce the Fund’s returns and potentially result in higher taxable distributions for shareholders.
Non-Diversification Risk. Because the Fund is non-diversified, it may invest a greater percentage of its assets in a single investment, such as the Underlying ETF. As a result, the Fund may be more sensitive to adverse events affecting the Underlying ETF than a diversified fund.
Fixed Income Securities Risk. When the Fund invests in fixed income securities, the value of your investment in the Fund will fluctuate with changes in interest rates.
New Fund Risk. The Fund is a recently organized management investment company with a limited operating history. As a result, there is limited performance history upon which investors can evaluate the Fund.
Market and Economic Risk. Broader economic conditions, interest rates, inflation, geopolitical events, and general market volatility may negatively affect the Underlying ETF and the Fund.
Brokerage commissions may be charged on trades.
Distributed by Foreside Fund Services, LLC.
A photo accompanying this announcement is available at
https://www.globenewswire.com/NewsRoom/AttachmentNg/bde0d3da-a3cf-49e7-800d-b3a174f51ecb SOURCE: Defiance ETFs
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