Annual Report

 

September 30, 2022

 

Etho Climate Leadership U.S. ETF
Ticker: ETHO

 

 

 

The fund is a series of ETF Managers Trust.

 


 

Etho Climate Leadership U.S. ETF

 

TABLE OF CONTENTS 

September 30, 2022 

 

  Page
Shareholder Letter 2
   
Growth of $10,000 Investment 3
   
Top 10 Holdings 4
   
Important Disclosures and Key Risk Factors 5
   
Portfolio Allocations 6
   
Schedule of Investments 7
   
Statement of Assets and Liabilities 16
   
Statement of Operations 17
   
Statements of Changes in Net Assets 18
   
Financial Highlights 19
   
Notes to the Financial Statements 20
   
Report of Independent Registered Public Accounting Firm 29
   
Expense Example 30
   
Supplementary Information 31
   
Information About Portfolio Holdings 31
   
Information About Proxy Voting 32
   
Trustees and Officers Table 33
   
Privacy Policy 35

 

1

 

Etho Climate Leadership U.S. ETF

 

Dear Shareholder,

 

On behalf of the entire team, we want to express our appreciation for the confidence you have placed in the Etho Climate Leadership U.S. Exchange-Traded Fund (“ETHO” or the “Fund”). The following information pertains to the fiscal period from October 1, 2021 to September 30, 2022.

 

The Fund seeks to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of the Etho Climate Leadership Index - U.S. (the “Index”).

 

Market Overview

 

Beginning in the first quarter of 2020, financial markets in the United States and around the world experienced extreme and, in many cases, unprecedented volatility and severe losses due to the global pandemic caused by COVID-19. Some sectors of the economy and individual issuers have experienced particularly large losses because of these disruptions. In response to these disruptions, the U.S. government and the Federal Reserve have taken extraordinary actions to support the domestic economy and financial markets, contributing to inflationary pressure and expectations for inflation. Further, Russia’s military invasion of Ukraine in February 2022, the resulting responses by the United States and other countries, and the potential for wider conflict have increased volatility and uncertainty in the financial markets and adversely affect regional and global economies. The full extent and duration of these conditions and the totality of repercussions are impossible to predict but could continue to result in significant market disruptions and may continue to negatively affect global supply chains, inflation and global growth. These and related events have impacted the ETFs’ performance, among other factors, and the value of an investment in the ETFs. We encourage you to talk with your financial advisor and visit etfmg.com for further insight about investing in today’s markets

 

For the fiscal-year ended September 30, 2022, the total return for the Fund was -21.58% while the total return for the Index was -22.08%. The best performers in the Fund on the basis of contribution to its return were Enphase Energy Inc, H&R Block Inc, First Solar Inc, Vertex Pharmaceuticals Inc and First Horizon Corp while the worst performers Romeo Power Inc, Beyond Meat Inc, Align Technology Inc, Xl Fleet Corp, and Teladoc Health Inc.

 

During the reporting period, the Fund saw an average approximate allocation of 23.61% to the Information Technology sector, 20.69% to Industrials and 15.21% to Consumer Discretionary. The Fund invests in the United States.

 

As you may know, the Etho Climate Leadership U.S. ETF offers broad diversification across companies that have demonstrated efficiency and leadership with their use of resources and their supply chains when compared to industry peers. The Fund holds roughly 265 equities equally weighted (at the time of rebalance) and results in a carbon emissions profile that is, on average, 60-80% lower per dollar invested than conventional U.S. benchmark indices. ETHO avoids investment in any direct fossil fuel companies, as well as enablers of that industry, along with a series of other unsustainable industries such as Tobacco/Weapons/Gambling, etc. Equal weighting of the Fund allows for the elimination of equities that do not meet ETHO’s standards without there being a significant impact on the diversification or performance of the Fund. It also creates broad exposure to both the sectors and factors that potentially make for greater stability and higher performance.

 

There is much ahead for environmentally sustainable and socially responsible investing. We are thankful you have joined us by investing in the Etho Climate Leadership U.S. ETF. You can find further details about ETHO by visiting www.etfmg.com, or by calling 1- 844-ETF-MGRS (1-844-383-6477).

 

Sincerely,

 

 

Samuel Masucci III

Chairman of the Board

 

2

Etho Climate Leadership U.S. ETF
Growth of $10,000 (Unaudited)

 

 

 

Average Annual Returns

Year Ended September 30, 2022

  1 Year
Return
  5 Year
Return
  Since
Inception
(11/18/2015)
    Value of
$10,000

 (9/30/2022)
Etho Climate Leadership U.S. ETF (NAV)   -21.58%   8.53%   10.30%   $ 19,613
Etho Climate Leadership U.S. ETF (Market)   -21.66%   8.51%   10.30%   $ 19,614
S&P 500 Index   -15.47%   9.24%   10.26%   $ 19,564
Etho Climate Leadership Index - U.S.   -22.08%   8.07%   9.76%   $ 18,960

 

Performance data quoted represents past performance and does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more of less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted. All performance is historical and includes reinvestment of dividends and capital gains. Performance data current to the most recent month end may be obtained by calling 1-844-ETF-MGRS (1-844-383-6477).

 

The chart illustrates the performance of a hypothetical $10,000 investment made on November 18, 2015, and is not intended to imply any future performance. The returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions from the sales of Fund shares. The chart assumes reinvestment of capital gains and dividends. The chart assumes reinvestment of capital gains and dividends, if any. The Index Returns do not reflect fees or expenses and are not available for direct investment.

 

3

 

Etho Climate Leadership U.S. ETF 

 

Top Ten Holdings as of September 30, 2022 (Unaudited)*
    Security   % of Total
Investments
1   H&R Block, Inc.   0.63%
2   First Solar, Inc.   0.61%
3   Array Technologies, Inc.   0.57%
4   Enphase Energy, Inc.   0.53%
5   Lamb Weston Holdings, Inc.   0.50%
6   Shoals Technologies Group, Inc. - Class A   0.49%
7   Amalgamated Financial Corp.   0.49%
8   Alnylam Pharmaceuticals, Inc.   0.47%
9   Stem, Inc.   0.47%
10   Genuine Parts Co.   0.46%
    Top Ten Holdings 5.22% of Total Investments    
    * Current Fund holdings may not be indicative of future Fund holdings.    

 

4

 

Etho Climate Leadership U.S. ETF

 

Important Disclosures and Key Risk Factors 

 

Investing involves risk, including the possible loss of principal. Shares of any ETF are bought and sold at market price (not NAV), may trade at a discount or premium to NAV and are not individually redeemed from the Fund. Brokerage commissions will reduce returns. Narrowly focused investments typically exhibit higher volatility.

 

Past performance is not indicative of future return. A fund’s performance for very short time periods may not be indicative of future performance.

 

ETHO

 

The ETHO Climate Leadership US ETF (the “Fund”) seeks to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of the Etho Climate Leadership Index (the “Index”).

 

The Fund’s return may not match or achieve a high degree of correlation with the return of the Etho Climate Leadership Index — US.

 

To the extent the Fund utilizes a sampling approach, it may experience tracking error to a greater extent than if the Fund had sought to replicate the Index.

 

Unlike with an actively managed fund, the Fund’s adviser does not use techniques or defensive strategies designed to lessen the effects of market volatility or to reduce the impact of periods of market decline. This means that, based on market and economic conditions, the Fund’s performance could be lower than other types of funds that may actively shift their portfolio assets to take advantage of market opportunities or to lessen the impact of a market decline.

 

Natural or environmental disasters, such as earthquakes, fires, floods, hurricanes, tsunamis and other severe weather-related phenomena generally, and widespread disease, including pandemics and epidemics, have been and may be highly disruptive to economies and markets, adversely impacting individual companies, sectors, industries, markets, currencies, interest and inflation rates, credit ratings, investor sentiment, and other factors affecting the value of the Fund’s investments. Given the increasing interdependence among global economies and markets, conditions in one country, market, or region are increasingly likely to adversely affect markets, issuers, and/or foreign exchange rates in other countries, including the U.S. Any such events could have a significant adverse impact on the value of the Fund’s investments.

 

Additionally, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or other events could result in increased premiums or discounts to the Fund’s NAV.

 

ETF Managers Group LLC serves as the investment adviser to the Fund.

 

The Fund is distributed by ETFMG Financial LLC. Both ETF Managers Group LLC and ETFMG Financial LLC are wholly owned subsidiaries of Exchange Traded Managers Group LLC (collectively, “ETFMG”). ETFMG Financial LLC is not affiliated with Etho Capital.

 

The Fund is intended to be made available only to U.S. residents. Under no circumstances is any information provided on this website intended for distribution to or use by, or to be an offer to sell to or solicitation of an offer to buy the Fund or any investment product or service of, any person or entity in any jurisdiction or country, other than the United States, where such distribution, use, offer or solicitation would subject the Fund or its affiliates to any registration requirement or be unlawful under the securities laws of that jurisdiction or country.

 

5

 

Etho Climate Leadership U.S. ETF 

 

PORTFOLIO ALLOCATIONS

As of September 30, 2022 (Unaudited) 

 

 

    Etho Climate
Leadership
U.S.
ETF
 
As a percent of Net Assets:      
Bermuda     0.4 %
Canada     0.4  
Ireland     0.3  
United States     98.4  
Short-Term and other Net Assets (Liabilities)     0.5  
      100.0 %

  

6

 

Etho Climate Leadership U.S. ETF

 

Schedule of Investments

September 30, 2022

 

 

    Shares     Value  
             
COMMON STOCKS - 99.5%                
Bermuda - 0.4%                
Chemicals - 0.4%                
Axalta Coating Systems, Ltd. (a)     27,875     $ 587,048  
                 
Canada - 0.4%                
Commercial Services & Supplies - 0.4%                
Waste Connections, Inc.     4,916       664,299  
                 
Ireland - 0.3%                
Health Care Equipment & Supplies - 0.3%                
STERIS PLC     2,838       471,903  
                 
United States - 98.4%                
Air Freight & Logistics - 0.4%                
United Parcel Service, Inc. - Class B (b)     3,230       521,774  
Auto Components - 0.8%                
Gentex Corp.     23,561       561,695  
QuantumScape Corp. (a)(b)     34,276       288,261  
XL Fleet Corp. (a)(b)     344,317       306,442  
Total Auto Components             1,156,398  
Automobiles - 0.4%                
Arcimoto, Inc. (a)(b)     103,659       143,049  
Tesla, Inc. (a)     1,907       505,832  
Total Automobiles             648,881  
Banks - 3.9%                
Amalgamated Financial Corp.     38,350       864,792  
Bank of Hawaii Corp.     8,216       625,402  
Commerce Bancshares, Inc. (b)     9,596       634,871  
Cullen/Frost Bankers, Inc. (b)     4,971       657,266  
First Horizon Corp.     29,304       671,061  
South State Corp.     8,472       670,305  
SVB Financial Group (a)     1,225       411,331  
Truist Financial Corp. (b)     12,259       533,757  
Washington Federal, Inc.     21,089       632,248  
Total Banks             5,701,033  
Biotechnology - 1.5%                
Agios Pharmaceuticals, Inc. (a)(b)     23,537       665,626  
Alnylam Pharmaceuticals, Inc. (a)     4,196       839,872  
Vertex Pharmaceuticals, Inc. (a)     2,626       760,332  
Total Biotechnology             2,265,830  
Building Products - 2.7%                
A.O. Smith Corp.     10,792       524,275  
Advanced Drainage Systems, Inc.     5,771       717,740  
Apogee Enterprises, Inc.     14,548       556,025  
Armstrong World Industries, Inc.     7,640       605,317  

 

The accompanying notes are an integral part of these financial statements.

 

7

 

Etho Climate Leadership U.S. ETF

 

Schedule of Investments

September 30, 2022 (Continued)

 

 

    Shares     Value  
             
Fortune Brands Home & Security, Inc.     9,251     $ 496,686  
Lennox International, Inc.     2,666       593,638  
Trex Co., Inc. (a)     10,487       460,799  
Total Building Products             3,954,480  
Capital Markets - 3.3%                
Affiliated Managers Group, Inc.     4,861       543,703  
Ares Management Corp. - Class A     8,496       526,327  
Charles Schwab Corp.     8,162       586,603  
Franklin Resources, Inc. (b)     24,744       532,491  
Interactive Brokers Group, Inc. - Class A     10,407       665,111  
MarketAxess Holdings, Inc.     2,021       449,652  
MSCI, Inc.     1,367       576,587  
Northern Trust Corp.     5,910       505,660  
T. Rowe Price Group, Inc.     4,567       479,581  
Total Capital Markets             4,865,715  
Commercial Services & Supplies - 2.9%                
Cintas Corp.     1,616       627,315  
Copart, Inc. (a)     5,461       581,050  
MillerKnoll, Inc.     19,917       310,705  
Pitney Bowes, Inc.     134,108       312,472  
Republic Services, Inc.     5,184       705,232  
Rollins, Inc.     19,753       685,034  
Steelcase, Inc. - Class A (b)     57,886       377,417  
Waste Management, Inc.     4,335       694,510  
Total Commercial Services & Supplies             4,293,735  
Communications Equipment - 2.1%                
Arista Networks, Inc. (a)     4,930       556,548  
Ciena Corp. (a)     11,301       456,899  
Cisco Systems, Inc.     12,365       494,600  
F5 Networks, Inc. (a)     3,279       474,570  
Juniper Networks, Inc.     18,526       483,899  
Motorola Solutions, Inc.     2,836       635,179  
Total Communications Equipment             3,101,695  
Construction & Engineering - 0.9%                
Ameresco, Inc. - Class A (a)     8,618       572,925  
Infrastructure and Energy Alternatives, Inc. (a)(b)     57,822       782,910  
Total Construction & Engineering             1,355,835  
Construction Materials - 0.4%                
Vulcan Materials Co.     3,742       590,151  
Consumer Finance - 1.0%                
Ally Financial, Inc.     15,941       443,638  
American Express Co.     3,673       495,524  
Discover Financial Services     6,243       567,614  
Total Consumer Finance             1,506,776  
Containers & Packaging - 1.1%                
AptarGroup, Inc.     5,859       556,781  
Avery Dennison Corp.     3,950       642,664  
Packaging Corp. of America (b)     4,416       495,873  
Total Containers & Packaging             1,695,318  

 

The accompanying notes are an integral part of these financial statements.

 

8

 

Etho Climate Leadership U.S. ETF

 

Schedule of Investments

September 30, 2022 (Continued)

 

 

    Shares     Value  
Distributors - 1.0%            
Genuine Parts Co.     5,462     $ 815,586  
LKQ Corp.     15,188       716,114  
Total Distributors             1,531,700  
Diversified Consumer Services - 1.2%                
H&R Block, Inc. (b)     26,452       1,125,268  
Service Corp. International     10,438       602,690  
Total Diversified Consumer Services             1,727,958  
Diversified Financial Services - 0.8%                
Cannae Holdings, Inc. (a)     28,645       591,806  
Voya Financial, Inc. (b)     10,349       626,114  
Total Diversified Financial Services             1,217,920  
Diversified Telecommunication Services - 0.8%                
ATN International, Inc.     17,226       664,407  
Verizon Communications, Inc.     13,569       515,215  
Total Diversified Telecommunication Services             1,179,622  
Electrical Equipment - 4.7%                
Array Technologies, Inc. (a)(b)     60,797       1,008,015  
Blink Charging Co. (a)(b)     25,895       458,859  
ChargePoint Holdings, Inc. (a)(b)     34,466       508,718  
Eos Energy Enterprises, Inc. (a)(b)     163,921       273,748  
FuelCell Energy, Inc. (a)(b)     118,956       405,640  
Plug Power, Inc. (a)(b)     23,949       503,168  
Rockwell Automation, Inc.     2,463       529,816  
Romeo Power, Inc. (a)     459,860       183,944  
Shoals Technologies Group, Inc. - Class A (a)     40,211       866,547  
Stem, Inc. (a)     62,233       830,188  
SunPower Corp. (a)(b)     31,899       734,953  
Sunrun, Inc. (a)(b)     22,561       622,458  
Total Electrical Equipment             6,926,054  
Electronic Equipment, Instruments & Components - 3.5%                
Badger Meter, Inc.     6,884       636,013  
CDW Corp.     3,838       599,035  
IPG Photonics Corp. (a)(b)     6,242       526,513  
Itron, Inc. (a)     13,006       547,683  
Keysight Technologies, Inc. (a)     4,337       682,469  
Littelfuse, Inc.     2,750       546,398  
National Instruments Corp.     17,061       643,882  
Trimble, Inc. (a)     9,498       515,456  
Zebra Technologies Corp. - Class A (a)     1,655       433,627  
Total Electronic Equipment, Instruments & Components             5,131,076  
Entertainment - 1.3%                
Liberty Media Corp-Liberty Formula One - Class C (a)(b)     9,811       573,943  
Live Nation Entertainment, Inc. (a)(b)     5,824       442,857  
Netflix, Inc. (a)(b)     1,829       430,620  
Walt Disney Co. (a)     4,996       471,273  
Total Entertainment             1,918,693  

 

The accompanying notes are an integral part of these financial statements.

 

9

 

Etho Climate Leadership U.S. ETF

 

Schedule of Investments

September 30, 2022 (Continued)

 

 

    Shares     Value  
Food & Staples Retailing - 0.7%                
PriceSmart, Inc.     8,728     $ 502,646  
Sysco Corp.     8,425       595,731  
Total Food & Staples Retailing             1,098,377  
Food Products - 1.3%                
Beyond Meat, Inc. (a)(b)     14,183       200,973  
Hain Celestial Group, Inc. (a)     19,918       336,216  
Lamb Weston Holdings, Inc.     11,490       889,097  
McCormick & Co., Inc.     6,887       490,836  
Total Food Products             1,917,122  
Health Care Equipment & Supplies - 2.4%                
ABIOMED, Inc. (a)     2,068       508,024  
Align Technology, Inc. (a)     1,571       325,370  
Cooper Cos.     1,640       432,796  
DexCom, Inc. (a)     5,357       431,453  
Edwards Lifesciences Corp. (a)     5,820       480,907  
IDEXX Laboratories, Inc. (a)     1,252       407,902  
ResMed, Inc.     2,833       618,443  
Teleflex, Inc.     1,934       389,624  
Total Health Care Equipment & Supplies             3,594,519  
Health Care Providers & Services - 2.0%                
AMN Healthcare Services, Inc. (a)     6,567       695,839  
Henry Schein, Inc. (a)     7,858       516,821  
Molina Healthcare, Inc. (a)     2,054       677,491  
Patterson Cos., Inc.     21,406       514,172  
Quest Diagnostics, Inc. (b)     5,023       616,272  
Total Health Care Providers & Services             3,020,595  
Health Care Technology - 0.2%                
Teladoc Health, Inc. (a)(b)     9,499       240,800  
Hotels, Restaurants & Leisure - 1.7%                
Booking Holdings, Inc. (a)     291       478,174  
Chipotle Mexican Grill, Inc. (a)(b)     432       649,192  
Expedia Group, Inc. (a)     3,501       328,009  
Hilton Worldwide Holdings, Inc.     4,519       545,082  
Marriott International, Inc. - Class A     3,909       547,807  
Total Hotels, Restaurants & Leisure             2,548,264  
Household Durables - 1.7%                
DR Horton, Inc.     9,236       622,045  
NVR, Inc. (a)     153       610,023  
Tempur Sealy International, Inc. (b)     24,672       595,582  
TopBuild Corp. (a)     3,777       622,374  
Total Household Durables             2,450,024  
Household Products - 0.3%                
Church & Dwight Co., Inc.     6,922       494,508  

 

The accompanying notes are an integral part of these financial statements.

 

10

 

Etho Climate Leadership U.S. ETF

 

Schedule of Investments

September 30, 2022 (Continued)

 

 

    Shares     Value  
Independent Power and Renewable Electricity Producers  - 1.3%                
Clearway Energy, Inc. - Class A     20,717     $ 602,865  
Ormat Technologies, Inc.     8,390       723,218  
Sunnova Energy International, Inc. (a)(b)     29,713       656,063  
Total Independent Power and Renewable Electricity Producers             1,982,146  
Insurance - 2.7%                
Cincinnati Financial Corp.     5,060       453,224  
Citizens, Inc. (a)(b)     161,602       539,751  
Globe Life, Inc.     6,821       680,054  
Hartford Financial Services Group, Inc.     9,577       593,199  
MBIA, Inc. (a)     44,521       409,593  
MetLife, Inc.     9,854       598,926  
W R Berkley Corp.     10,355       668,726  
Total Insurance             3,943,473  
Interactive Media & Services - 0.6%                
Alphabet, Inc. - Class A (a)     4,926       471,172  
IAC, Inc. (a)     6,832       378,356  
Total Interactive Media & Services             849,528  
Internet & Direct Marketing Retail - 0.6%                
Amazon.com, Inc. (a)     4,203       474,939  
eBay, Inc.     12,004       441,867  
Total Internet & Direct Marketing Retail             916,806  
IT Services - 4.6%                
Akamai Technologies, Inc. (a)     5,738       460,876  
Broadridge Financial Solutions, Inc.     4,414       637,029  
Fidelity National Information Services, Inc.     6,844       517,201  
Fiserv, Inc. (a)     6,757       632,252  
Gartner, Inc. (a)     2,302       636,940  
Global Payments, Inc.     5,014       541,763  
Jack Henry & Associates, Inc. (b)     3,483       634,846  
MasterCard, Inc. - Class A     1,918       545,364  
Paychex, Inc.     5,065       568,344  
PayPal Holdings, Inc. (a)     5,924       509,879  
VeriSign, Inc. (a)     3,080       534,996  
Visa, Inc. - Class A (b)     3,097       550,182  
Total IT Services             6,769,672  
Leisure Products - 0.4%                
Hasbro, Inc.     8,462       570,508  
Life Sciences Tools & Services - 2.7%                
Bio-Rad Laboratories, Inc. - Class A (a)     1,217       507,659  
Bio-Techne Corp.     1,583       449,572  
Danaher Corp.     2,337       603,623  
Illumina, Inc. (a)     1,960       373,948  
IQVIA Holdings, Inc. (a)     2,963       536,718  
Mettler-Toledo International, Inc. (a)     498       539,892  
Waters Corp. (a)     2,207       594,853  
West Pharmaceutical Services, Inc.     1,670       410,954  
Total Life Sciences Tools & Services             4,017,219  

 

The accompanying notes are an integral part of these financial statements.

 

11

 

Etho Climate Leadership U.S. ETF

 

Schedule of Investments

September 30, 2022 (Continued)

 

 

    Shares     Value  
Machinery - 3.5%            
Deere & Co. (b)     1,653     $ 551,920  
Fortive Corp.     11,254       656,108  
Hyliion Holdings Corp. (a)(b)     154,670       443,903  
Hyzon Motors, Inc. (a)     107,228       182,288  
Illinois Tool Works, Inc.     3,287       593,797  
Lightning eMotors, Inc. (a)(b)     120,209       186,324  
Microvast Holdings, Inc. (a)     102,267       185,103  
Proterra, Inc. (a)(b)     91,115       453,753  
Watts Water Technologies, Inc. - Class A     4,916       618,089  
Westinghouse Air Brake Technologies Corp. (b)     7,141       580,920  
Xylem, Inc.     8,056       703,771  
Total Machinery             5,155,976  
Media - 1.6%                
Interpublic Group of Cos., Inc.     19,451       497,946  
John Wiley & Sons, Inc. - Class A     12,986       487,754  
Liberty Broadband Corp. - Class C (a)     5,063       373,649  
New York Times Co. - Class A     14,979       430,646  
TEGNA, Inc.     30,682       634,504  
Total Media             2,424,499  
Oil, Gas & Consumable Fuels - 0.4%                
Enviva, Inc.     8,812       529,249  
Personal Products - 0.4%                
Estee Lauder Cos., Inc. - Class A     2,520       544,068  
Pharmaceuticals - 1.7%                
Bristol-Myers Squibb Co.     9,428       670,237  
Merck & Co., Inc.     8,398       723,235  
Pfizer, Inc.     13,383       585,640  
Zoetis, Inc.     3,641       539,924  
Total Pharmaceuticals             2,519,036  
Professional Services - 1.2%                
Insperity, Inc.     6,848       699,112  
Robert Half International, Inc.     6,021       460,607  
Verisk Analytics, Inc.     3,196       545,014  
Total Professional Services             1,704,733  
Real Estate Investment Trusts (REITs) - 3.7%                
AvalonBay Communities, Inc.     2,774       510,943  
Camden Property Trust     4,142       494,762  
Four Corners Property Trust, Inc.     25,559       618,272  
Gladstone Land Corp.     18,905       342,181  
Hannon Armstrong Sustainable Infrastructure Capital, Inc. (b)     14,547       435,392  
Kimco Realty Corp.     27,910       513,823  
Prologis, Inc.     4,264       433,222  
Public Storage, Inc.     1,813       530,865  
Regency Centers Corp.     9,678       521,161  
SBA Communications Corp.     1,994       567,591  
UDR, Inc.     12,013       501,062  
Total Real Estate Investment Trusts (REITs)             5,469,274  

 

The accompanying notes are an integral part of these financial statements.

 

12

 

Etho Climate Leadership U.S. ETF

 

Schedule of Investments

September 30, 2022 (Continued)

 

 

    Shares     Value  
Road & Rail - 1.6%                
AMERCO (b)     1,148     $ 584,585  
JB Hunt Transport Services, Inc.     3,423       535,426  
Landstar System, Inc.     4,554       657,460  
Old Dominion Freight Line, Inc.     2,295       570,927  
Total Road & Rail             2,348,398  
Semiconductors & Semiconductor Equipment - 6.9%                
Advanced Micro Devices, Inc. (a)     6,266       397,014  
Analog Devices, Inc.     4,162       579,933  
Applied Materials, Inc.     5,207       426,610  
Broadcom, Inc.     1,094       485,747  
Enphase Energy, Inc. (a)     3,396       942,288  
First Solar, Inc. (a)(b)     8,182       1,082,233  
Intel Corp.     13,999       360,754  
KLA Corp.     1,880       568,944  
Lam Research Corp.     1,277       467,382  
Micron Technology, Inc.     8,808       441,281  
NVIDIA Corp.     2,511       304,810  
ON Semiconductor Corp. (a)     10,944       682,140  
Power Integrations, Inc.     7,404       476,225  
Qorvo, Inc. (a)     5,521       438,423  
QUALCOMM, Inc.     4,500       508,410  
Rambus, Inc. (a)     21,485       546,149  
Teradyne, Inc. (b)     5,799       435,795  
Texas Instruments, Inc.     3,769       583,366  
Universal Display Corp.     4,112       387,967  
Total Semiconductors & Semiconductor Equipment             10,115,471  
Software - 5.2%                
Adobe Systems, Inc. (a)     1,503       413,626  
Ansys, Inc. (a)     2,156       477,985  
Autodesk, Inc. (a)     3,196       597,013  
Cadence Design System, Inc. (a)     4,166       680,850  
Dolby Laboratories, Inc. - Class A     8,780       572,017  
Fortinet, Inc. (a)     10,024       492,479  
Intuit, Inc.     1,426       552,318  
Microsoft Corp.     2,229       519,134  
NCR Corp. (a)     17,048       324,082  
Paycom Software, Inc. (a)     1,977       652,390  
Salesforce, Inc. (a)     3,227       464,172  
ServiceNow, Inc. (a)     1,230       464,460  
Tyler Technologies, Inc. (a)     1,540       535,150  
Workday, Inc. - Class A (a)(b)     2,861       435,501  
Zoom Video Communications, Inc. - Class A (a)(b)     5,845       430,134  
Total Software             7,611,311  

 

The accompanying notes are an integral part of these financial statements.

 

13

 

Etho Climate Leadership U.S. ETF

 

Schedule of Investments

September 30, 2022 (Continued)

 

 

    Shares     Value  
Specialty Retail - 5.7%                
Advance Auto Parts, Inc. (b)     3,331     $ 520,769  
American Eagle Outfitters, Inc. (b)     41,232       401,187  
America’s Car-Mart, Inc. (a)     8,504       518,914  
AutoNation, Inc. (a)(b)     6,880       700,866  
Best Buy Co., Inc.     7,602       481,511  
EVgo, Inc. (a)(b)     53,280       421,445  
Foot Locker, Inc. (b)     23,587       734,262  
Group 1 Automotive, Inc. (b)     4,088       584,053  
Lowe’s Cos., Inc.     3,412       640,808  
Penske Automotive Group, Inc. (b)     7,357       724,150  
Ross Stores, Inc.     7,594       639,946  
TJX Cos., Inc.     11,389       707,485  
Tractor Supply Co. (b)     2,956       549,461  
Volta, Inc. (a)(b)     224,653       271,830  
Williams-Sonoma, Inc. (b)     4,762       561,202  
Total Specialty Retail             8,457,889  
Technology Hardware, Storage & Peripherals - 1.6%                
3D Systems Corp. (a)(b)     41,078       327,802  
Apple, Inc.     3,932       543,403  
Hewlett Packard Enterprise Co.     41,241       494,067  
NetApp, Inc.     8,301       513,417  
Western Digital Corp. (a)     13,800       449,190  
Total Technology Hardware, Storage & Peripherals             2,327,879  
Textiles, Apparel & Luxury Goods - 1.6%                
Fossil Group, Inc. (a)     71,077       243,083  
Hanesbrands, Inc. (b)     46,404       322,972  
PVH Corp. (b)     8,946       400,781  
Ralph Lauren Corp. (b)     6,074       515,865  
Tapestry, Inc.     18,538       527,035  
VF Corp. (b)     12,135       362,958  
Total Textiles, Apparel & Luxury Goods             2,372,694  
Thrifts & Mortgage Finance - 1.1%                
Capitol Federal Financial, Inc.     64,674       536,794  
New York Community Bancorp, Inc. (b)     65,485       558,587  
TFS Financial Corp.     41,837       543,881  
Total Thrifts & Mortgage Finance             1,639,262  
Trading Companies & Distributors - 2.3%                
Fastenal Co.     11,631       535,491  
Herc Holdings, Inc.     4,129       428,921  
MSC Industrial Direct Co., Inc. - Class A     8,149       593,329  
United Rentals, Inc. (a)     1,929       521,061  
W.W. Grainger, Inc. (b)     1,334       652,579  
WESCO International, Inc. (a)(b)     5,265       628,536  
Total Trading Companies & Distributors             3,359,917  

 

The accompanying notes are an integral part of these financial statements.

 

14

 

Etho Climate Leadership U.S. ETF

 

Schedule of Investments

September 30, 2022 (Continued)

 

 


  Shares     Value  
Water Utilities - 1.5%            
American States Water Co.     7,747     $ 603,879  
American Water Works Co., Inc.     4,164       541,986  
California Water Service Group     11,631       612,837  
Middlesex Water Co.     6,544       505,197  
Total Water Utilities             2,263,899  

Wireless Telecommunication Services - 0.5%

               
T-Mobile US, Inc. (a)(b)     5,338       716,199  
Total United States             145,263,959  
TOTAL COMMON STOCKS (Cost $172,341,695)             146,987,209  
                 

INVESTMENTS PURCHASED WITH PROCEEDS FROM SECURITIES LENDING COLLATERAL - 20.6%

               
Mount Vernon Liquid Assets Portfolio, LLC, 3.18% (c)     30,356,003       30,356,003  
TOTAL INVESTMENTS PURCHASED WITH PROCEEDS FROM SECURITIES LENDING COLLATERAL (Cost $30,356,003)             30,356,003  
                 

SHORT-TERM INVESTMENTS - 0.4%

               

Money Market Funds - 0.4%

               
First American Government Obligations Fund - Class X, 2.77% (c)     598,730       598,730  
TOTAL SHORT-TERM INVESTMENTS (Cost $598,730)             598,730  
                 
Total Investments (Cost $203,296,428) - 120.5%             177,941,942  
Liabilities in Excess of Other Assets - (20.5)%             (30,271,778 )
TOTAL NET ASSETS - 100.0%           $ 147,670,164  

 

Percentages are stated as a percent of net assets.

 

(a)      Non-income producing security. 

(b)      This security or a portion of this security was out on loan at September 30, 2022. 

(c)      The rate shown is the annualized seven-day yield at period end.

 

The Global Industry Classification Standard (GICS®) was developed by and/or is the exclusive property of MSCI, Inc. 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 U.S. Bancorp Fund Services, LLC, doing business as U.S. Bank Global Fund Services (“Fund Services”).

 

The accompanying notes are an integral part of these financial statements.

 

15

 

Etho Climate Leadership U.S. ETF

 

STATEMENT OF ASSETS AND LIABILITIES

As of September 30, 2022

 

 

    Etho Climate
Leadership
U.S. ETF
 
ASSETS      
Investments in securities, at value*   $ 177,941,942  
Receivables:        
Dividends and interest receivable     114,861  
Securities lending income receivable     28,793  
Total Assets     178,085,596  
         
LIABILITIES        
Collateral received for securities loaned (Note 7)     30,356,003  
Payables:        
Management fees payable     59,429  
Total Liabilities     30,415,432  
Net Assets   $ 147,670,164  
         
NET ASSETS CONSIST OF:        
Paid-in capital   $ 183,084,823  
Total Distributable Earnings (Accumulated Losses)     (35,414,659 )
Net Assets   $ 147,670,164  
         
*Identified Cost:        
Investments in securities   $ 203,296,428  
         
Shares Outstanding^     3,200,000  
Net Asset Value, Offering and Redemption Price per Share   $ 46.15  

 


^ No par value, unlimited number of shares authorized

 

The accompanying notes are an integral part of these financial statements.

 

16

 

Etho Climate Leadership U.S. ETF

 

STATEMENT OF OPERATIONS 

For the Year Ended September 30, 2022 

 

 

    Etho Climate
Leadership
U.S. ETF
 
INVESTMENT INCOME      
Income:      
Dividends from unaffiliated securities (net of foreign witholding tax of $436)   $ 2,156,736  
Interest     10,289  
Securities lending income     251,893  
Total Investment Income     2,418,918  
         
Expenses:        
Management fees     795,259  
Total Expenses     795,259  
Net Investment Income     1,623,659  
         
REALIZED & UNREALIZED GAIN (LOSS) ON INVESTMENTS        
Net Realized Gain (Loss) on:        
Unaffiliated investments     (5,655,257 )
In-Kind redemptions     14,703,965  
Net Realized Gain on Investments and In-Kind Redemptions     9,048,708  
Net Change in Unrealized Appreciation/Depreciation of:        
Unaffiliated investments     (52,481,644 )
Net Change in Unrealized Appreciation/Depreciation of Investments     (52,481,644 )
Net Realized and Unrealized Loss on Investments     (43,432,936 )
NET DECREASE IN NET ASSETS RESULTING FROM  OPERATIONS   $ (41,809,277 )

 

The accompanying notes are an integral part of these financial statements.

 

17

 

Etho Climate Leadership U.S. ETF

 

STATEMENTS OF CHANGES IN NET ASSETS 

 

  

    Year Ended
September 30,
2022
    Year Ended
September 30,
2021
 
OPERATIONS            
Net investment income   $ 1,623,659     $ 1,122,668  
Net realized gain on investments and In-Kind Redemptions     9,048,708       24,800,863  
Net change in unrealized appreciation/depreciation of investments     (52,481,644 )     9,213,851  
Net increase (decrease) in net assets resulting from operations     (41,809,277 )     35,137,382  
                 
DISTRIBUTIONS TO SHAREHOLDERS                
Total Distributions to Shareholders     (1,482,849 )     (1,179,000 )
                 
CAPITAL SHARE TRANSACTIONS                
Net increase in net assets derived from net change in outstanding shares     12,892,115       53,551,110  
Net increase (decrease) in net assets     (30,400,011 )     87,509,492  
                 
NET ASSETS                
Beginning of Year     178,070,175       90,560,683  
End of Year   $ 147,670,164     $ 178,070,175  

 

Summary of share transactions is as follows:

 

    Year Ended
September 30, 2022
    Year Ended
September 30, 2021
 
    Shares     Amount     Shares     Amount  
Shares Sold     1,000,000
  $ 57,868,130       2,100,000     $ 120,572,535  
Shares Redeemed     (800,000 )     (44,976,015 )     (1,150,000 )     (67,021,425 )
Net Transactions in Fund Shares     200,000
  $ 12,892,115       950,000     $ 53,551,110  
                                 
Beginning Shares     3,000,000               2,050,000          
Ending Shares     3,200,000               3,000,000          

 

The accompanying notes are an integral part of these financial statements.

 

18

 

Etho Climate Leadership U.S. ETF

 

FINANCIAL HIGHLIGHTS

For a capital share outstanding throughout the year 

 

 

    Year Ended
September 30,
2022
    Year Ended
September 30,
2021
    Year Ended
September 30,
2020
    Year Ended
September 30,
2019
    Year Ended
September 30,
2018
 
Net Asset Value, Beginning of Year   $ 59.36     $ 44.18     $ 39.58     $ 37.50     $ 32.01  
Income from Investment Operations:                                        
Net Investment Income 1     0.52       0.47       0.41       0.33       0.29  
Net realized and unrealized gain (loss) on investments     (13.26 )     15.17       4.54       2.08       5.51  
Total from investment operations     (12.74 )     15.64       4.95       2.41       5.80  
Less Distributions:                                        
Distributions from net investment income     (0.47 )     (0.46 )     (0.35 )     (0.33 )     (0.29 )
Net realized gains                             (0.02 )
Total distributions     (0.47 )     (0.46 )     (0.35 )     (0.33 )     (0.31 )
Net assets value, end of year   $ 46.15     $ 59.36     $ 44.18     $ 39.58     $ 37.50  
Total Return     (21.58 )%     35.48 %     12.59 %     6.53 %     18.16 %
                                         
Ratios/Supplemental Data:                                        
Net assets at end of year (000’s)   $ 147,670     $ 178,070     $ 90,561     $ 53,431     $ 35,627  
Expenses to Average Net Assets     0.45 %     0.45 %     0.45 %     0.45 %     0.45 %
Net Investment Income to Average Net Assets     0.92 %     0.83 %     1.00 %     0.88 %     0.82 %
Portfolio Turnover Rate     30 %     45 %     37 %     41 %     19 %

 


1 Calculated based on average shares outstanding during the year.

 

The accompanying notes are an integral part of these financial statements.

 

19

 

Etho Climate Leadership U.S. ETF

 

NOTES TO FINANCIAL STATEMENTS

September 30, 2022

 

NOTE 1 – ORGANIZATION

 

Etho Climate Leadership U.S. ETF (the “Fund”) is a series of ETF Managers Trust (the “Trust”), an open-end management investment company consisting of multiple investment series, organized as a Delaware statutory trust on July 1, 2009. The Trust is registered with the 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 Fund’s shares (“Shares”) is registered under the Securities Act of 1933, as amended (the “Securities Act”). The Fund seeks to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of the Etho Climate Leadership Index – U.S. (“the Index”). The Fund commenced operations on November 18, 2015.

 

The Fund currently offers one class of shares, which has no front end sales load, no deferred sales charges, and no redemption fees. The Fund may issue an unlimited number of shares of beneficial interest, with no par value. All shares of the Fund have equal rights and privileges.

 

Shares of the Fund are listed and traded on the NYSE Arca, Inc. Market prices for the Shares may be different from their net asset value (“NAV”). The Fund issues and redeems Shares on a continuous basis at NAV only in blocks of 50,000 shares, called “Creation Units.” Creation Units are issued and redeemed principally in-kind for securities included in the Index. Once created, Shares generally trade in the secondary market at market prices that change throughout the day in quantities less than a Creation Unit. Except when aggregated in Creation Units, Shares are not redeemable securities of the Fund. Shares of the 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 DTC 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. Therefore, they are unable to purchase or redeem the Shares directly from the Fund. Rather, most retail investors may purchase Shares in the secondary market with the assistance of a broker and may be subject to customary brokerage commissions or fees.

 

Authorized Participants transacting in Creation Units for cash may pay an additional variable charge to compensate the relevant Fund for certain transaction costs (i.e., brokerage costs) and market impact expenses relating to investing in portfolio securities. Such variable charges, if any, are included in “Transaction Fees” in the Statements of Changes in Net Assets.

 

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES

 

The following is a summary of significant accounting policies consistently followed by the Fund. These policies are in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

 

The Fund follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board Accounting Standard Codification Topic 946 Financial Services – Investment Companies.

 

The Fund may invest in certain other investment companies (underlying funds) . For more information about the underlying fund’s operations and policies, please refer to those funds’ semiannual and annual reports, which are filed with the SEC.

 


A. Security Valuation. Securities listed on a securities exchange, market or automated quotation system for which quotations are readily available (except for securities traded on NASDAQ), including securities traded over the counter, are valued at the last quoted sale price on the primary exchange or market (foreign or domestic) on which they are traded on the valuation date (or at approximately 4:00 pm Eastern Time if a security’s primary exchange is normally open at that time), or, if there is no such reported sale on the valuation date, at the most recent quoted bid price. For securities traded on NASDAQ, the NASDAQ Official Closing Price will be used.

  

20

 

Etho Climate Leadership U.S. ETF

 

NOTES TO FINANCIAL STATEMENTS 

September 30, 2022 (Continued)

 

Securities for which quotations are not readily available are valued at their respective fair values as determined in good faith by ETF Managers Group, LLC (the “Adviser”), using procedures adopted by the 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 Fund’s Board. The use of fair value pricing by the Fund may cause the net asset value of its shares to differ significantly from the net asset value that would be calculated without regard to such considerations. As of September 30, 2022, the Fund did not hold any securities fair valued by the Adviser.

 

As described above, the Fund utilizes various methods to measure the fair value of its investments on a recurring basis. U.S. GAAP establishes a hierarchy that prioritizes inputs to valuation methods. The three levels of inputs are:

 


Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities that the Fund has 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 observable inputs are not available; representing the Fund’s 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.

 

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.

  

21

 

Etho Climate Leadership U.S. ETF

 

NOTES TO FINANCIAL STATEMENTS 

September 30, 2022 (Continued)

 

The following table presents a summary of the inputs used to value the Fund’s net assets as of September 30, 2022: 

 

Etho Climate Leadership U.S. ETF                                
Assets^   Level 1     Level 2     Level 3     Total  
Common Stocks   $ 146,987,209     $     $     $ 146,987,209  
Short-Term Investments     598,730                   598,730  
Investments Purchased with Securities Lending Collateral*                       30,356,003  
Total Investments in Securities   $ 147,585,939     $     $     $ 177,941,942  

 

^ See Schedule of Investments for classifications by sector or country.

 

* Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in the table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the Schedule of Investments.

 


B. Federal Income Taxes. The Fund has elected to be taxed as a “regulated investment company” and intends to distribute substantially all taxable income to its shareholders and otherwise comply with the provisions of the Internal Revenue Code applicable to regulated investment companies. Therefore, no provisions for federal income taxes or excise taxes have been made.

 

To avoid imposition of the excise tax applicable to regulated investment companies, the Fund intends to declare each year as dividends, in each calendar year, at least 98.0% of its net investment income (earned during the calendar year) and 98.2% of its net realized capital gains (earned during the twelve months ended October 31) plus undistributed amounts, if any, from prior years.

 

Net capital losses incurred after October 31, within the taxable year are deemed to arise on the first business day of the Fund’s next taxable year.

 

The Fund recognizes the tax benefits of uncertain tax positions only where the position is “more likely than not” to be sustained assuming examination by tax authorities. The Fund has analyzed its tax position and has concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions expected to be taken in the Fund’s 2022 tax returns. The Fund identifies its major tax jurisdictions as U.S. Federal, the State of New Jersey, and the State of Delaware; however the Fund 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 twelve months.

 

As of September 30, 2022, management has reviewed the tax positions for open periods (for federal purposes, three years from the date of filing and for state purposes, generally a range of three to four years from the date of filing) as applicable to the Fund, and has determined that no provision for income tax is required in the Fund’s financial statements.

 


C. Security Transactions and Investment Income. Investment securities transactions are accounted for on the trade date. Gains and losses realized on sales of securities are determined on a specific identification basis. Discounts/premiums on debt securities purchased are accreted/amortized over the life of the respective securities using the effective interest method. Dividend income is recorded on the ex-dividend date. Interest income is recorded on an accrual basis. Income, including gains, from investments in foreign securities received by the Fund may be subject to income, withholding or other taxes imposed by foreign countries.

  

22

 

Etho Climate Leadership U.S. ETF

 

NOTES TO FINANCIAL STATEMENTS 

September 30, 2022 (Continued)

 


D. Foreign Currency Translations and Transactions. The Fund may engage in foreign currency transactions. Foreign currency transactions are translated into U.S. dollars on the following basis: (i) market value of investment securities, assets and liabilities at the daily rates of exchange, and (ii) purchases and sales of investment securities, dividend and interest income and certain expenses at the rates of exchange prevailing on the respective dates of such transactions. For financial reporting purposes, the Fund does not isolate changes in the exchange rate of investment securities from the fluctuations arising from changes in the market prices of securities for unrealized gains and losses. However, for federal income tax purposes, the Fund does isolate and treat as ordinary income the effect of changes in foreign exchange rates on realized gains or losses from the sale of investment securities and payables and receivables arising from trade-date and settlement-date differences.

 


E. Distributions to Shareholders. Distributions to shareholders from net investment income, if any, are declared and paid by the Fund on a quarterly basis. Distributions to shareholders from net realized gains on securities of the Fund normally are 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 at the date of the financial statements, as well as the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates.

 


G. Share Valuation. The net asset value (“NAV”) per share of the 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 by the Fund, rounded to the nearest cent. The Fund’s shares will not be priced on the days on which the NYSE is closed for trading. The offering and redemption price per share for the Fund is equal to the Fund’s net asset value per share.

 


H. Guarantees and Indemnifications. In the normal course of business, the Fund enters into contracts with service providers that contain general indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. However, based on experience, the Fund expects the risk of loss to be remote.

 

NOTE 3 – RISK FACTORS

 

Investing in the Etho Climate Leadership U.S. ETF may involve certain risks, as discussed in the Fund’s prospectus, including, but not limited to, those described below. Any of these risks could cause an investor to lose money.

 

Market Risk. Financial markets rise and fall in response to a variety of factors, sometimes rapidly and unpredictably. As with any investment whose performance is tied to these markets, the value of an investment in a fund will fluctuate, which means that an investor could lose money over short or long periods.

 

Investment Style Risk. The Fund is not actively managed. Therefore, the Fund follows the securities included in its respective index during upturns as well as downturns. Because of its indexing strategy, the Fund does not take steps to reduce market exposure or to lessen the effects of a declining market. In addition, because of the Fund’s expenses, the Fund’s performance may be below that of its index.

  

23

 

Etho Climate Leadership U.S. ETF

 

NOTES TO FINANCIAL STATEMENTS 

September 30, 2022 (Continued)

 

Equity Risk. The prices of equity securities rise and fall daily. These price movements may result from factors affecting individual companies, industries or the securities market as a whole. In addition, equity markets tend to move in cycles which may cause stock prices to fall over short or extended periods of time.

 

Securities Lending Risk. Securities lending involves the risk of loss of rights in, or delay in recovery of, the loaned securities if the borrower fails to return the security loaned or becomes insolvent.

 

Concentration Risk. To the extent that the Fund’s or its underlying index’s portfolio is concentrated in the securities of issuers in a particular market, industry, group of industries, sector or asset class, the Fund may be adversely affected by the performance of those securities, may be subject to increased price volatility and may be more vulnerable to adverse economic, market, political or regulatory occurrences affecting that market, industry, group of industries, sector or asset class.

 

Natural Disaster/Epidemic Risk. Natural or environmental disasters, such as earthquakes, fires, floods, hurricanes, tsunamis and other severe weather related phenomena generally, and widespread disease, including pandemics and epidemics (for example, the novel coronavirus COVID-19), have been and can be highly disruptive to economies and markets and have recently led, and may continue to lead, to increased market volatility and significant market losses. Such natural disaster and health crises could exacerbate political, social, and economic risks previously mentioned, and result in significant breakdowns, delays, shutdowns, social isolation, and other disruptions to important global, local and regional supply chains affected, with potential corresponding results on the operating performance of the Fund and its investments. A climate of uncertainty and panic, including the contagion of infectious viruses or diseases, may adversely affect global, regional, and local economies and reduce the availability of potential investment opportunities, and increases the difficulty of performing due diligence and modeling market conditions, potentially reducing the accuracy of financial projections. Under these circumstances, the Fund may have difficulty achieving its investment objective which may adversely impact performance. Further, such events can be highly disruptive to economies and markets, significantly disrupt the operations of individual companies (including, but not limited to, the Fund’s third party service providers), sectors, industries, markets, securities and commodity exchanges, currencies, interest and inflation rates, credit ratings, investor sentiment, and other factors affecting the value of the Fund’s investments. These factors can cause substantial market volatility, exchange trading suspensions and closures and can impact the ability of the Fund to complete redemptions and otherwise affect Fund performance and Fund trading in the secondary market. A widespread crisis may also affect the global economy in ways that cannot necessarily be foreseen at the current time. How long such events will last and whether they will continue or recur cannot be predicted. Impacts from these events could have significant impact on the Fund’s performance, resulting in losses to the Fund.

 

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.

 

A complete description of the principal risks is included in the Fund’s prospectus under the heading “Principal Investment Risks.”

  

24

 

Etho Climate Leadership U.S. ETF

 

NOTES TO FINANCIAL STATEMENTS 

September 30, 2022 (Continued)

 

NOTE 4 – MANAGEMENT AND CONTRACTS

 

The Adviser serves as the investment advisor to the Fund. Pursuant to an Investment Advisory Agreement (“Advisory Agreement”) between the Trust, on behalf of the Fund, and the Adviser, the Adviser provides investment advice to the Fund and oversees the day-today operations of the Fund, subject to the direction and control of the Board and the officers of the Trust. Under the Advisory Agreement, the Adviser is also responsible for arranging transfer agency, custody, fund administration and accounting, and other non-distribution related services necessary for the Fund to operate.

 

Under the Investment Advisory Agreement with the Fund, the Adviser has overall responsibility for the general management and administration of the Fund and arranges for sub-advisory, transfer agency, custody, fund administration, securities lending, and all other non-distribution related services necessary for the Fund to operate. The Adviser bears the costs of all advisory and non-advisory services required to operate the Fund, in exchange for a single unitary fee. For services provided the Fund pays the Adviser at an annual rate of 0.45% of the Fund’s average daily net assets. Under the Investment Advisory Agreement, the Adviser has agreed to pay all expenses of the Fund, except for: the fee paid to the Adviser pursuant to the Investment Advisory Agreement, interest charges on any borrowings, 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 (12b-1) fees and expenses (collectively, “Excluded Expenses”). The Adviser has entered into an agreement with its affiliate, ETFMG Financial, LLC, to serve as distributor to the Fund (the “Distributor”). The Distributor provides marketing support for the Fund, including distributing marketing materials related to the Fund.

 

The Adviser has entered into an Agreement with Etho Capital, LLC ( “Etho”), under which Etho agrees to sublicense the use of the Underlying Index to the Adviser. Etho also provides marketing support for the Fund. Etho does not make investment decisions, provide investment advice, or otherwise act in the capacity of an investment Adviser to the Fund.

 

U.S. Bancorp Fund Services, LLC doing business as U.S. Bank Global Fund Services (the “Administrator”) provides fund accounting, fund administration, and transfer agency services to the Fund. The Adviser compensates the Administrator for these services under an administration agreement between the two parties.

 

The Adviser pays each independent Trustee a quarterly fee for service to the Fund. Each Trustee is also reimbursed by the Adviser for all reasonable out-of-pocket expenses incurred in connection with his duties as Trustee, including travel and related expenses incurred in attending Board meetings.

 

NOTE 5 – DISTRIBUTION PLAN

 

The Fund has adopted a Plan of Distribution pursuant to Rule 12b- 1 under the 1940 Act. Under the Plan, the Fund may pay compensation to the Distributor or any other distributor or financial institution with which the Trust has an agreement with respect to the Fund, with the amount of such compensation not to exceed an annual rate of 0.25% of the Fund’s average daily net assets. For the year ended September 30, 2022, the Fund did not incur any 12b-1 expenses.

 

NOTE 6 - PURCHASES AND SALES OF SECURITIES

 

The costs of purchases and sales of securities, excluding short-term securities and in-kind transactions, for the year ended September 30, 2022:

 

    Purchases     Sales  
Etho Climate Leadership U.S. ETF   $ 52,194,428     $ 51,562,900  

  

25

 

Etho Climate Leadership U.S. ETF

 

NOTES TO FINANCIAL STATEMENTS 

September 30, 2022 (Continued)

 

The costs of purchases and sales of in-kind transactions associated with creations and redemptions for the year ended September 30, 2022:

 

    Purchases In-
Kind
    Sales In-
Kind
 
Etho Climate Leadership U.S. ETF   $ 56,985,796     $ 44,456,571  

  

Purchases in-kind are the aggregate of all in-kind purchases and sales in-kind are the aggregate of all proceeds from in-kind sales. Net capital gains or losses resulting from in-kind redemptions are excluded from the determination of the Fund’s taxable gains and are not distributed to shareholders. There were no purchases or sales of U.S. Government obligations for the six months ended September 30, 2022.

 

NOTE 7 — SECURITIES LENDING

 

The Fund may lend up to 33 1⁄3% of the value of the securities in its portfolio to brokers, dealers and financial institutions (but not individuals) under terms of participation in a securities lending program administered by U.S. Bank N.A. (“the Custodian”). The securities lending agreement requires that loans are collateralized at all times in an amount equal to at least 102% of the value of any loaned securities at the time of the loan, plus accrued interest. The Fund receives compensation in the form of fees and earn interest on the cash collateral. The amount of fees depends on a number of factors including the type of security and length of the loan. The Fund continues to receive interest payments or dividends on the securities loaned during the borrowing period. Gain or loss in the fair value of securities loaned that may occur during the term of the loan will be for the account of the Fund. The Fund has the right under the terms of the securities lending agreement to recall the securities from the borrower on demand. The cash collateral is invested by the Custodian in accordance with approved investment guidelines. Those guidelines require the cash collateral to be invested in readily marketable, high quality, short-term obligations either directly on behalf of the Fund or through one or more joint accounts, money market funds, or short-term bond funds, including those advised by or affiliated with the Adviser; however, such investments are subject to risk of payment delays or default on the part of the issuer or counterparty or otherwise may not generate sufficient interest to support the costs associated with securities lending. Other investment companies, in which the Fund may invest cash collateral, can be expected to incur fees and expenses for operations, such as investment advisory and administration fees, which would be in addition to those incurred by the Fund, and which may be received in full or in part by the Adviser. Pursuant to guidance issued by the SEC staff, fees and expenses of money market funds used for cash collateral received in connection with loans of securities are not treated as Acquired Fund Fees and Expenses, which reflect a fund’s pro rata share of the fees and expenses incurred by other investment companies in which the Fund invests (as disclosed in the Prospectus, as applicable). The Fund could also experience delays in recovering its securities and possible loss of income or value if the borrower fails to return the borrowed securities, although the Fund is indemnified from this risk by contract with the securities lending agent.

 

As of September 30, 2022, the value of the securities on loan and payable for collateral due to broker were as follows:

 

Value of Securities on Loan Collateral Received 

 

Fund   Values of
Securities
on Loan
    Fund
Collateral
Received*
 
Etho Climate Leadership U.S. ETF   $ 29,242,742     $ 30,356,003  

 

* The cash collateral received was invested in the Mount Vernon Liquid Assets Portfolio as shown on the Schedule of Investments, an investment with an overnight and continuous maturity.

 

26

 

Etho Climate Leadership U.S. ETF

 

NOTES TO FINANCIAL STATEMENTS 

September 30, 2022 (Continued)

 

NOTE 8 – FEDERAL INCOME TAXES

 

The components of distributable earnings (losses) and cost basis of investments for federal income tax purposes at September 30, 2022, were as follows:

 

    Cost     Gross
Unrealized
Appreciation
    Gross
Unrealized
Depreciation
    Net
Unrealized
Appreciation
(Depreciation)
 
Etho Climate Leadership U.S. ETF   $ 205,512,383     $ 11,876,629     $ (39,447,070 )   $ (27,570,441 )

  

    Undistributed
Ordinary
Income
    Undistributed
Long-Term
Gain
    Total
Distributable
Earnings
    Other
Accumulated
(Loss)
    Total
Accumulated
Gain
 
Etho Climate Leadership U.S. ETF   $ 172,725     $       —     $ 172,725     $ (8,016,943 )   $ (35,414,659 )

 

As of September 30, 2022, the Fund had accumulated capital loss carryovers of:

 

    Capital Loss
Carryover
ST
    Capital
Loss
Carryover
LT
    Expires  
Etho Climate Leadership U.S. ETF   $ (8,013,002 )   $     —       Indefinite  

 

Under current tax law, capital and currency losses realized after October 31 of a fund’s fiscal year may be deferred and treated as occurring on the first business day of the following fiscal year for tax purposes. The Fund had deferred post-October capital and currency losses, which will be treated as arising on the first business day of the year ended September 30, 2022.

 

    Later Year Ordinary Loss   Post-October Loss
Etho Climate Leadership U.S. ETF   None   None

  

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 net asset value per share. For the fiscal year ended September 30, 2022, the following table shows the reclassifications made:

 

    Total
Distributable
Earnings/(Loss)
    Paid-In
Capital
 
ETHO Climate Leadership U.S. ETF   $ (14,310,179 )   $ 14,310,179  

  

27

 

Etho Climate Leadership U.S. ETF

 

NOTES TO FINANCIAL STATEMENTS 

September 30, 2022 (Continued)

 

The tax character of distributions paid by the Fund during the fiscal years ended September 30, 2022 and September 30, 2021 are as follows:

 

    Year Ended
September 30, 2022
    Year Ended
September 30, 2021
 
    From
Ordinary
Income
    From
Capital
Gains
    From
Ordinary
Income
    From
Capital
Gains
 
Etho Climate Leadership U.S. ETF   $ 1,482,849     $     $ 1,179,000     $  

 

NOTE 9 – LEGAL MATTERS

 

The Trust, the Adviser, and certain officers and affiliated persons of the Adviser (together with the Adviser, the “Adviser Defendants”) were named as defendants in an action filed December 21, 2021, in the Superior Court of New Jersey, Union County, captioned PureShares, LLC, d/b/a PureFunds et al. v. ETF Managers Group, LLC et al., Docket No. UNN-C-152-21 (the “NJ Action”). The NJ Action asserted breach of contract and other tort claims and sought damages in unspecified amounts and injunctive relief. On May 25, 2022, the court in the NJ Action dismissed with prejudice all claims asserted against the Trust, as well as all contract claims and all except one tort claim asserted against the Adviser Defendants.

 

As of September 30, 2022, there were no adjustments made to the accompanying financial statements based on the above legal matters.

 

NOTE 10 – SUBSEQUENT EVENTS

 

In preparing these financial statements, the Fund has evaluated events and transactions for potential recognition or disclosure through the date the financial statements were issued. This evaluation did not result in any subsequent events that necessitated disclosures and/or adjustments to the Financial Statements.

  

28

 

Etho Climate Leadership U.S. ETF

 

Report of Independent Registered Public Accounting Firm

 

To the Board of Trustees of ETF Managers Trust 

and the Shareholders of Etho Climate Leadership U.S. ETF:

 

Opinion on the Financial Statements

 

We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Etho Climate Leadership U.S. ETF (the “Fund”) (a series of ETF Managers Trust) as of September 30, 2022, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the periods indicated therein, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of September 30, 2022, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the periods indicated therein, in conformity with accounting principles generally accepted in the United States of America.

 

Basis for Opinion

 

These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion.

 

Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of September 30, 2022 by correspondence with the custodian. We believe that our audits provide a reasonable basis for our opinion.

 

/s/WithumSmith+Brown, PC

 

We have served as the auditor for one or more series of the Trust since 2013.

 

New York, New York 

November 29, 2022

 

29

 

Etho Climate Leadership U.S. ETF

 

Expense Example 

Six Months Ended September 30, 2022 (Unaudited)

 

As a shareholder of Etho Climate Leadership U.S. ETF (the “Fund”) 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. These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Fund 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 period (April 1, 2022 to September 30, 2022).

 

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 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 Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s 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 Fund 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.

 

Etho Climate Leadership U.S. ETF

 

    Beginning
Account
Value
April 1,
2022
    Ending
Account
Value
September 30,
2022
    Expenses
Paid
During the
Period^
    Annualized
Expense
Ratio During
Period
April 1,
2022 to
September 30,
2022
 
Actual   $ 1,000.00     $ 794.70     $ 2.02       0.45 %
Hypothetical (5% annual)   $ 1,000.00     $ 1,022.81     $ 2.28       0.45 %

 

^ The dollar amounts shown as expenses paid during the period are equal to the annualized six-month expense ratio multiplied by the average account value during the period, multiplied by 183/365 (to reflect the one-half year period).

 

30

 

Etho Climate Leadership U.S. ETF

 

SUPPLEMENTARY INFORMATION 

September 30, 2022 (Unaudited)

 

NOTE 1 – FREQUENCY DISTRIBUTION OF PREMIUMS AND DISCOUNTS

 

Information regarding how often shares of the Fund traded on the Exchange at a price above (i.e., at a premium) or below (i.e., at a discount) the NAV is available on the Fund’s website at www.etfmgfunds.com.

 

NOTE 2 – FEDERAL TAX INFORMATION

 

Qualified Dividend Income/Dividends Received Deduction

 

For the fiscal year ended September 30, 2022, certain dividends paid by the Fund may be subject to a maximum tax rate of 15%, as provided for by the Jobs and Growth Tax Reconciliation Act of 2003. The percentage of dividends declared from ordinary income designated as qualified dividend income was as follows: 

Fund Name Qualified Dividend Income
Etho Climate Leadership U.S. ETF 100%

 

For corporate shareholders, the percent of ordinary income distributions qualifying for the corporate dividends received deduction for the fiscal year ended September 30, 2022 was as follows: 

Fund Name Dividends Received Deduction
Etho Climate Leadership U.S. ETF 100%

  

Short Term Capital Gain 

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 the Fund were as follows:

Fund Name Short-Term Capital Gain
Etho Climate Leadership U.S. ETF 0%

  

NOTE 3 – INFORMATION ABOUT PORTFOLIO HOLDINGS

 

The Fund files a complete schedule of portfolio holdings with the SEC for its first and third fiscal quarters on Part F of Form N-PORT. Once filed, the Fund’s Part F of Form N-PORT is available without charge, upon request on the SEC’s website (www.sec.gov), the Fund’s website (www.etfmgfunds.com) and is available by calling (877) 756-7873. The Fund’s portfolio holdings are posted on the Fund’s website at www.etfmgfunds.com daily.

  

31

 

Etho Climate Leadership U.S. ETF

 

SUPPLEMENTARY INFORMATION 

September 30, 2022 (Unaudited) (Continued)

 

NOTE 4 – INFORMATION ABOUT PROXY VOTING

 

A description of the policies and procedures the Fund uses to determine how to vote proxies relating to portfolio securities is provided in the Statement of Additional Information (“SAI”). The SAI is available without charge upon request by calling toll-free at 1-844-ETF-MGRS (1-844-383-6477), by accessing the SEC’s website at www.sec.gov, or by accessing the Fund’s website at www.etfmgfunds.com.

 

Information regarding how the Fund voted proxies relating to portfolio securities during the period ending June 30 is available by calling toll-free at 1-844-ETF-MGRS (1-844-383-6477) or by accessing the SEC’s website at www.sec.gov.

 

Carefully consider the Fund’s investment objectives, risk factors, charges, and expenses before investing. This and additional information can be found in the Fund’s prospectus, which may be obtained by calling 1-844-ETF-MGRS (1-844-383-6477) or by visiting www.etfmgfunds.com. Read the prospectus carefully before investing.

  

32

 

Etho Climate Leadership U.S. ETF

 

Board of Trustees

 

Set forth below are the names, birth years, positions with the Trust, length of term of office, and the principal occupations and other directorships held during at least the last five years of each of the persons currently serving as a Trustee of the Trust, as well as information about each officer. The business address of each Trustee and officer is 30 Maple Street, 2nd Floor, Summit, New Jersey 07901. The SAI includes additional information about Fund directors and is available, without charge, upon request by calling 1-844-ETF-MGRS (1-844-383-6477).

  

Name and Year
of Birth
Position(s)
Held with the
Trust, Term
of Office and
Length of
Time Served
Principal Occupation(s) During
Past 5 Years
Number of
Portfolios
in Fund
Complex
Overseen
By Trustee
Other
Directorships
Held by
Trustee
During Past 5
Years
Interested Trustee and Officers
Samuel Masucci,
III (1962)
Trustee, Chairman of the Board and President (since 2012); Secretary (since 2014) Chief Executive Officer, Exchange Traded Managers Group LLC (since 2013); Chief Executive Officer, ETF Managers Group LLC (since 2016); Chief Executive Officer, ETF Managers Capital LLC (commodity pool operator) (since 2014). 17 None
John A.
Flanagan (1946)
Treasurer (since 2015) President, John A. Flanagan CPA, LLC (accounting services) (since 2010); Treasurer, ETF Managers Trust (since 2015); Chief Financial Officer, ETF Managers Capital, LLC (commodity pool operator) (since 2015). n/a Independent Trustee - Absolute Shares Trust (since 2014) (6 portfolios)
Kevin Hourihan
(1978)
Chief Compliance Officer (since 2022) Senior Principal Consultant, Fund Chief Compliance Officer, ACA Global, LLC (since 2022); Chief Compliance Officer, Ashmore Funds (2017-2022); Chief Compliance Officer, Ashmore Investment Management (US) Corp (2014-2022); Chief Compliance Officer, Ashmore Equities Investment Management (2015-2019). n/a n/a
Matthew J.
Bromberg (1973)
Assistant Secretary (since 2020) Chief Compliance Officer of ETF Managers Group, LLC (since 2022); General Counsel and Secretary of Exchange Traded Managers Group LLC (since 2020); ETF Managers Group LLC (since 2020); ETFMG Financial LLC (since 2020); ETF Managers Capital LLC (since 2020); Partner of Dorsey & Whitney LLP (law firm) (2019-2020); General Counsel of WBI Investments, Inc. (2016-2019); Millington Securities, Inc. (2016-2019). n/a n/a
* Mr. Masucci is an interested Trustee by virtue of his role as the Chief Executive Officer of the Adviser.

 

 

33

 

Etho Climate Leadership U.S. ETF

 

Board of Trustees (Continued)

 

Name and Year
of Birth
Position(s)
Held with the
Trust, Term
of Office and
Length of
Time Served
Principal Occupation(s) During
Past 5 Years
Number of
Portfolios
in Fund
Complex
Overseen
By Trustee
Other
Directorships
Held by
Trustee
During Past 5
Years
Terry Loebs
(1963)
Trustee (since 2014); Lead Independent Trustee (since 2020) Founder and Managing Member, Pulsenomics LLC (index product development and consulting firm) (since 2011); Managing Director, MacroMarkets, LLC (exchange-traded products firm) (2006-2011). 17 None
Eric Wiegel
(1960)
Trustee (since 2020) Senior Portfolio Manager, Little House Capital (2019-present); Managing Partner, Global Focus Capital LLC (2013-present); Chief Investment Officer, Insight Financial Strategist LLC (2017-2018). 17 None

  

34

 

Etho Climate Leadership U.S. ETF

 

ETF MANAGERS TRUST

 

Privacy Policy and Procedures

 

ETF Managers Trust, (the “Trust”) has adopted the following privacy policies in order to safeguard the personal information of the Trust’s customers and consumers in accordance with Regulation S-P as promulgated by the U.S. Securities and Exchange Commission.

 

Trust officers are responsible for ensuring that the following policies and procedures are implemented:

 

1)    The Trust is committed to protecting the confidentiality and security of the information they collect and will handle personal customer and consumer information only in accordance with Regulation S-P and any other applicable laws, rules and regulations1. The Trust will ensure: (a) the security and confidentiality of customer records and information; (b) that customer records and information are protected from any anticipated threats and hazards; and (c) that customer records and information are protected from unauthorized access or use.

 

2)    The Trust conducts its business affairs through its trustees, officers and third parties that provide services pursuant to agreements with the Trust. The Trust has no employees. It is anticipated that the trustees and officers of the Trust who are not employees of service providers of the Trust will not have access to customer records and information in the performance of their normal responsibilities for the Trust.

 

3)    The Trust may share customer information with its affiliates, subject to the customers’ right to prohibit such sharing.

 

4)    The Trust may share customer information with unaffiliated third parties only in accordance with the requirements of Regulation S-P. Pursuant to this policy, the Trust will not share customer information with unaffiliated third parties other than as permitted by law, unless authorized to do so by the customer.

 

Consistent with these policies, the Trust has adopted the following procedures:

 

1)    The Trust will determine that the policies and procedures of its affiliates and Service Providers are reasonably designed to safeguard customer information and only permit appropriate and authorized access to and use of customer information through the application of appropriate administrative, technical and physical protections.

 

2)    The Trust will direct each of its Service Providers to adhere to the privacy policy of the Trust and to its privacy policies with respect to all customer information of the Trust and to take all actions reasonably necessary so that the Trust is in compliance with the provisions of Regulation S-P, including, as applicable, the development and delivery of privacy notices and the maintenance of appropriate and adequate records.

 

3)    The Trust requires its Service Providers to provide periodic reports to the Trust’s Board of Trustees outlining their privacy policies and the implementation of such policies. Each Service Provider is required to promptly report to the Trust’s Board any material changes to its privacy policy before, or promptly after, the adoption of such changes.

 

(1) Generally, the Funds have institutional clients which are not considered “customers” for purposes of regulation S-P.

  

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Advisor 

ETF Managers Group, LLC 

30 Maple Street, Suite 2, Summit, NJ 07901

 

Distributor 

ETFMG Financial LLC 

30 Maple Street, Suite 2, Summit, NJ 07901

 

Custodian 

U.S. Bank National Association

 

Custody Operations 

1555 North River Center Drive, Suite 302, Milwaukee, Wisconsin 53212

 

Transfer Agent 

U.S. Bancorp Fund Services, LLC doing business as U.S. Bank Global Fund Services 

615 East Michigan Street, Milwaukee, Wisconsin 53202

 

Securities Lending Agent 

U.S. Bank, National Association 

Securities Lending 

800 Nicolet Mall 

Minneapolis, MN 55402-7020

 

Independent Registered Public Accounting Firm

WithumSmith + Brown, PC

1411 Broadway, 9th Floor, New York, NY 10018

 

Legal Counsel 

Sullivan & Worcester LLP 

1666 K Street NW, Washington, DC 20006