AXS Astoria Inflation Sensitive ETF

(PPI)

 

AXS Change Finance ESG ETF

(CHGX)

 

AXS First Priority CLO Bond ETF

(AAA)

 

AXS Green Alpha ETF

(NXTE)

 

AXS Brendan Wood TopGun Index ETF

(TGN)

 

AXS Esoterica NextG Economy ETF

(WUGI)

 

SEMI-ANNUAL REPORT

SEPTEMBER 30, 2023

 

 

AXS ETFs

Each a series of Investment Managers Series Trust II

 

Table of Contents

 

Schedule of Investments 1
Statements of Assets and Liabilities 23
Statements of Operations 25
Statements of Changes in Net Assets 31
Statement of Cash Flows 37
Financial Highlights 38
Notes to Financial Statements 44
Supplemental Information 61
Expense Examples 63

 

This report and the financial statements contained herein are provided for the general information of the shareholders of the AXS ETFs. This report is not authorized for distribution to prospective investors in the ETFs unless preceded or accompanied by an effective prospectus.

 

www.axsinvestments.com

 

 

AXS Astoria Inflation Sensitive ETF

SCHEDULE OF INVESTMENTS

As of September 30, 2023 (Unaudited)

 

 

Number            
of Shares         Value  
        COMMON STOCKS — 76.7%        
        AEROSPACE/DEFENSE — 5.8%        
  10,755     Airbus S.E.   $ 1,445,903  
  7,335     Rheinmetall A.G.     1,894,111  
              3,340,014  
        BUILDING MATERIALS — 3.0%        
  13,995     Builders FirstSource, Inc.*     1,742,238  
        CHEMICALS — 4.2%        
  21,092     Nutrien Ltd.     1,308,577  
  22,712     Olin Corp.     1,135,146  
              2,443,723  
        COMMERCIAL SERVICES — 2.4%        
  3,138     United Rentals, Inc.     1,395,061  
        DISTRIBUTION/WHOLESALE — 4.6%        
  58,453     Sumitomo Corp.     1,168,864  
  2,158     W.W. Grainger, Inc.     1,492,991  
              2,661,855  
        ELECTRONICS — 2.2%        
  35,932     ABB Ltd.     1,288,336  
        HAND/MACHINE TOOLS — 2.3%        
  7,480     Lincoln Electric Holdings, Inc.     1,359,789  
        IRON/STEEL — 8.6%        
  68,154     Fortescue Metals Group Ltd.     920,199  
  9,268     Nucor Corp.     1,449,052  
  3,702     Reliance Steel & Aluminum Co.     970,776  
  15,386     Steel Dynamics, Inc.     1,649,687  
              4,989,714  
        MACHINERY-DIVERSIFIED — 1.7%        
  8,167     AGCO Corp.     965,993  
        MINING — 8.5%        
  51,274     BHP Group Ltd.     1,464,331  
  616,624     Pilbara Minerals Ltd.     1,711,267  
  27,648     Rio Tinto PLC     1,746,006  
              4,921,604  
        OIL & GAS — 28.3%        
  30,845     Canadian Natural Resources Ltd.     2,004,013  
  9,357     Chevron Corp.     1,577,777  

1

 

AXS Astoria Inflation Sensitive ETF

SCHEDULE OF INVESTMENTS - Continued

As of September 30, 2023 (Unaudited)

 

 

Number            
of Shares         Value  
        COMMON STOCKS (Continued)        
        OIL & GAS (Continued)        
  34,849     Devon Energy Corp.   $ 1,662,297  
  15,124     EOG Resources, Inc.     1,917,118  
  131,269     Inpex Corp.     1,984,539  
  29,308     Ovintiv, Inc.     1,394,182  
  51,605     Suncor Energy, Inc.     1,782,892  
  30,738     Tourmaline Oil Corp.     1,553,951  
  10,847     Valero Energy Corp.     1,537,128  
  40,385     Woodside Energy Group Ltd.     951,093  
              16,364,990  
        PACKAGING & CONTAINERS — 2.1%        
  53,261     Graphic Packaging Holding Co.     1,186,655  
        SEMICONDUCTORS — 3.0%        
  9,387     Disco Corp.     1,734,920  
        TOTAL COMMON STOCKS        
        (Cost $41,919,873)     44,394,892  
        EXCHANGE-TRADED FUNDS — 22.4%        
  20,294     Aberdeen Standard Physical Precious Metals Basket Shares ETF*     1,707,838  
  22,785     iShares 0-5 Year TIPS Bond ETF     2,208,322  
  28,826     Schwab U.S. TIPS ETF     1,455,425  
  71,055     SPDR Gold MiniShares Trust*     2,604,876  
  46,701     Vanguard Short-Term Inflation-Protected Securities ETF     2,208,023  
  152,464     WisdomTree Enhanced Commodity Strategy Fund     2,747,401  
        TOTAL EXCHANGE-TRADED FUNDS        
        (Cost $13,308,761)     12,931,885  
        TOTAL INVESTMENTS — 99.1%        
        (Cost $55,228,634)     57,326,777  
        Other Assets in Excess of Liabilities — 0.9%     533,292  
        TOTAL NET ASSETS — 100.0%   $ 57,860,069  

 

PLC – Public Limited Company

ETF – Exchange-Traded Fund

 

* Non-income producing security.

 

See accompanying Notes to Financial Statements.

2

 

AXS Astoria Inflation Sensitive ETF

SUMMARY OF INVESTMENTS

As of September 30, 2023 (Unaudited)

 

 

    Percent of Total  
Security Type   Net Assets  
Common Stocks        
Oil & Gas     28.3 %
Iron/Steel     8.6 %
Mining     8.5 %
Aerospace/Defense     5.8 %
Distribution/Wholesale     4.6 %
Chemicals     4.2 %
Building Materials     3.0 %
Semiconductors     3.0 %
Commercial Services     2.4 %
Hand/Machine Tools     2.3 %
Electronics     2.2 %
Packaging & Containers     2.1 %
Machinery-Diversified     1.7 %
Total Common Stocks     76.7 %
Exchange-Traded Funds     22.4 %
Total Investments     99.1 %
Other Assets in Excess of Liabilities     0.9 %
Total Net Assets     100.0 %

 

See accompanying Notes to Financial Statements.

3

 

AXS Change Finance ESG ETF

SCHEDULE OF INVESTMENTS

As of September 30, 2023 (Unaudited)

 

 

Number of Shares         Value  
        COMMON STOCKS — 99.8%        
        APPAREL — 1.0%        
  12,250     NIKE, Inc. - Class B   $ 1,171,345  
        BIOTECHNOLOGY — 1.1%        
  4,860     Amgen, Inc.     1,306,174  
        BUILDING MATERIALS — 2.0%        
  21,687     Carrier Global Corp.     1,197,123  
  5,709     Vulcan Materials Co.     1,153,332  
              2,350,455  
        CHEMICALS — 1.9%        
  6,779     Ecolab, Inc.     1,148,363  
  8,789     PPG Industries, Inc.     1,140,812  
              2,289,175  
        COMMERCIAL SERVICES — 5.9%        
  4,894     Automatic Data Processing, Inc.     1,177,398  
  6,028     Equifax, Inc.     1,104,209  
  4,585     FleetCor Technologies, Inc.*     1,170,734  
  3,699     Moody's Corp.     1,169,513  
  19,931     PayPal Holdings, Inc.*     1,165,166  
  3,187     S&P Global, Inc.     1,164,562  
              6,951,582  
        COMPUTERS — 6.1%        
  3,849     Accenture PLC - Class A1     1,182,066  
  6,632     Apple, Inc.     1,135,465  
  17,398     Cognizant Technology Solutions Corp. - Class A     1,178,541  
  7,642     Crowdstrike Holdings, Inc. - Class A*     1,279,118  
  20,692     Fortinet, Inc.*     1,214,207  
  8,485     International Business Machines Corp.     1,190,445  
              7,179,842  
        COSMETICS/PERSONAL CARE — 1.0%        
  7,762     Estee Lauder Cos., Inc. - Class A     1,121,997  
        DISTRIBUTION/WHOLESALE — 2.0%        
  21,638     Fastenal Co.     1,182,300  
  1,745     W.W. Grainger, Inc.     1,207,261  
              2,389,561  
        DIVERSIFIED FINANCIAL SERVICES — 9.1%        
  7,886     American Express Co.     1,176,512  
  3,690     Ameriprise Financial, Inc.     1,216,519  
  14,265     Apollo Global Management, Inc.     1,280,427  

4

 

AXS Change Finance ESG ETF

SCHEDULE OF INVESTMENTS - Continued

As of September 30, 2023 (Unaudited)

 

 

Number of Shares         Value  
        COMMON STOCKS (Continued)        
        DIVERSIFIED FINANCIAL SERVICES (Continued)        
  1,778     BlackRock, Inc.   $ 1,149,459  
  21,064     Charles Schwab Corp.     1,156,414  
  6,146     CME Group, Inc.     1,230,552  
  10,560     Intercontinental Exchange, Inc.     1,161,811  
  3,019     Mastercard, Inc. - Class A     1,195,252  
  5,071     Visa, Inc. - Class A     1,166,381  
              10,733,327  
        ELECTRIC — 1.0%        
  16,407     Ormat Technologies, Inc.     1,147,177  
        ENERGY-ALTERNATE SOURCES — 0.8%        
  79,714     Sunrun, Inc.*     1,001,208  
        FOOD — 2.0%        
  41,698     Conagra Brands, Inc.     1,143,359  
  17,888     Sysco Corp.     1,181,502  
              2,324,861  
        HAND/MACHINE TOOLS — 0.9%        
  13,201     Stanley Black & Decker, Inc.     1,103,340  
        HEALTHCARE-PRODUCTS — 4.0%        
  12,107     Abbott Laboratories     1,172,563  
  15,287     Medtronic PLC1     1,197,889  
  4,394     Stryker Corp.     1,200,749  
  2,237     Thermo Fisher Scientific, Inc.     1,132,302  
              4,703,503  
        HEALTHCARE-SERVICES — 1.1%        
  2,614     UnitedHealth Group, Inc.     1,317,953  
        HOME BUILDERS — 1.9%        
  10,461     Lennar Corp. - Class A     1,174,038  
  15,183     PulteGroup, Inc.     1,124,301  
              2,298,339  
        HOUSEHOLD PRODUCTS/WARES — 2.0%        
  12,874     Church & Dwight Co., Inc.     1,179,645  
  9,672     Kimberly-Clark Corp.     1,168,861  
              2,348,506  
        INSURANCE — 3.1%        
  21,290     American International Group, Inc.     1,290,174  
  3,737     Aon PLC - Class A1     1,211,610  

5

 

AXS Change Finance ESG ETF

SCHEDULE OF INVESTMENTS - Continued

As of September 30, 2023 (Unaudited)

 

 

Number of Shares         Value  
        COMMON STOCKS (Continued)        
        INSURANCE (Continued)        
  6,389     Marsh & McLennan Cos., Inc.   $ 1,215,827  
              3,717,611  
        INTERNET — 4.0%        
  9,149     Alphabet, Inc. - Class A*     1,197,238  
  9,070     Alphabet, Inc. - Class C*     1,195,880  
  2,873     Netflix, Inc.*     1,084,845  
  5,121     Palo Alto Networks, Inc.*     1,200,567  
              4,678,530  
        MACHINERY-DIVERSIFIED — 1.9%        
  3,031     Deere & Co.     1,143,839  
  3,993     Rockwell Automation, Inc.     1,141,479  
              2,285,318  
        MEDIA — 2.0%        
  26,646     Comcast Corp. - Class A     1,181,484  
  14,889     Walt Disney Co.*     1,206,753  
              2,388,237  
        PHARMACEUTICALS — 10.4%        
  8,477     AbbVie, Inc.     1,263,582  
  20,210     Bristol-Myers Squibb Co.     1,172,988  
  14,266     Cardinal Health, Inc.     1,238,574  
  7,079     Cencora, Inc.     1,274,008  
  4,510     Cigna Group     1,290,176  
  2,248     Eli Lilly & Co.     1,207,468  
  7,706     Johnson & Johnson     1,200,209  
  3,021     McKesson Corp.     1,313,682  
  11,432     Merck & Co., Inc.     1,176,924  
  35,216     Pfizer, Inc.     1,168,115  
              12,305,726  
        REITS — 1.9%        
  1,594     Equinix, Inc.     1,157,658  
  10,031     Prologis, Inc.     1,125,579  
              2,283,237  
        RETAIL — 5.0%        
  492     AutoZone, Inc.*     1,249,675  
  8,105     Genuine Parts Co.     1,170,200  
  1,325     O'Reilly Automotive, Inc.*     1,204,239  
  10,229     Ross Stores, Inc.     1,155,366  
  13,472     TJX Cos., Inc.     1,197,391  
              5,976,871  

6

 

AXS Change Finance ESG ETF

SCHEDULE OF INVESTMENTS - Continued

As of September 30, 2023 (Unaudited)

 

 

Number of Shares         Value  
        COMMON STOCKS (Continued)        
        SEMICONDUCTORS — 11.9%        
  11,786     Advanced Micro Devices, Inc.*   $ 1,211,836  
  6,853     Analog Devices, Inc.     1,199,892  
  1,351     Broadcom, Inc.     1,122,114  
  35,455     Intel Corp.     1,260,425  
  2,483     KLA Corp.     1,138,853  
  21,389     Marvell Technology, Inc.     1,157,787  
  15,224     Microchip Technology, Inc.     1,188,233  
  17,813     Micron Technology, Inc.     1,211,818  
  2,525     NVIDIA Corp.     1,098,350  
  12,655     ON Semiconductor Corp.*     1,176,282  
  10,878     QUALCOMM, Inc.     1,208,111  
  7,414     Texas Instruments, Inc.     1,178,900  
              14,152,601  
        SOFTWARE — 12.9%        
  2,228     Adobe, Inc.*     1,136,057  
  5,614     Autodesk, Inc.*     1,161,593  
  5,182     Cadence Design Systems, Inc.*     1,214,143  
  2,299     Intuit, Inc.     1,174,651  
  3,801     Microsoft Corp.     1,200,166  
  2,292     MSCI, Inc.     1,175,979  
  10,349     Oracle Corp.     1,096,166  
  10,193     Paychex, Inc.     1,175,559  
  5,626     Salesforce, Inc.*     1,140,840  
  2,115     ServiceNow, Inc.*     1,182,200  
  2,714     Synopsys, Inc.*     1,245,644  
  7,381     VMware, Inc. - Class A*     1,228,789  
  5,095     Workday, Inc. - Class A*     1,094,661  
              15,226,448  
        TELECOMMUNICATIONS — 2.0%        
  6,382     Arista Networks, Inc.*     1,173,841  
  21,725     Cisco Systems, Inc.     1,167,936  
              2,341,777  

7

 

AXS Change Finance ESG ETF

SCHEDULE OF INVESTMENTS - Continued

As of September 30, 2023 (Unaudited)

 

 

Number of Shares         Value  
        COMMON STOCKS (Continued)        
        WATER — 0.9%        
  8,980     American Water Works Co., Inc.   $ 1,111,993  
        TOTAL COMMON STOCKS        
        (Cost $116,072,990)     118,206,694  
        TOTAL INVESTMENTS — 99.8%        
        (Cost $116,072,990)     118,206,694  
        Other Assets in Excess of Liabilities — 0.2%     258,382  
        TOTAL NET ASSETS — 100.0%   $ 118,465,076  

 

PLC – Public Limited Company

 

* Non-income producing security.
1 Foreign security denominated in U.S. Dollars.

 

See accompanying Notes to Financial Statements.

8

 

AXS Change Finance ESG ETF

SUMMARY OF INVESTMENTS

As of September 30, 2023 (Unaudited)

 

 

Security Type/Industry   Percent of Total Net Assets  
Common Stocks        
Software     12.9 %
Semiconductors     11.9 %
Pharmaceuticals     10.4 %
Diversified Financial Services     9.1 %
Computers     6.1 %
Commercial Services     5.9 %
Retail     5.0 %
Internet     4.0 %
Healthcare-Products     4.0 %
Insurance     3.1 %
Household Products/Wares     2.0 %
Telecommunications     2.0 %
Media     2.0 %
Distribution/Wholesale     2.0 %
Food     2.0 %
Building Materials     2.0 %
REITS     1.9 %
Home Builders     1.9 %
Chemicals     1.9 %
Machinery-Diversified     1.9 %
Healthcare-Services     1.1 %
Biotechnology     1.1 %
Cosmetics/Personal Care     1.0 %
Apparel     1.0 %
Electric     1.0 %
Water     0.9 %
Hand/Machine Tools     0.9 %
Energy-Alternate Sources     0.8 %
Total Common Stocks     99.8 %
Total Investments     99.8 %
Other Assets in Excess of Liabilities     0.2 %
Total Net Assets     100.0 %

 

See accompanying Notes to Financial Statements. 

9

 

AXS First Priority CLO Bond ETF

SCHEDULE OF INVESTMENTS

As of September 30, 2023 (Unaudited)

 

 

Principal Amount         Value  
        COLLATERALIZED MORTGAGE OBLIGATIONS — 92.3%        
        AIMCO CLO Series        
$ 350,000     Series 2017-AA, 6.638%, (3-Month Term SOFR+131.16 basis points), 4/20/20341,2,3   $ 346,814  
        AMMC CLO XI Ltd.        
  326,790     Series 2012-11A, 6.641%, (3-Month Term SOFR+127.16 basis points), 4/30/20311,2,3     325,451  
        AMMC CLO XVIII Ltd.        
  226,625     Series 2016-18A, 6.750%, (3-Month Term SOFR+136.16 basis points), 5/26/20311,2,3     226,151  
        Bain Capital Credit CLO        
  248,359     Series 2018-1A, 6.567%, (3-Month Term SOFR+122.16 basis points), 4/23/20311,2,3     247,587  
        Barings CLO Ltd.        
  279,908     Series 2015-2A, 6.778%, (3-Month Term SOFR+145.16 basis points), 10/20/20301,2,3     279,472  
        Battalion CLO XX Ltd.        
  250,000     Series 2021-20A, 6.750%, (3-Month Term SOFR+144.16 basis points), 7/15/20341,2,3     248,687  
        Burnham Park CLO Ltd.        
  221,937     Series 2016-1A, 6.738%, (3-Month Term SOFR+141.16 basis points), 10/20/20291,2,3     221,744  
        Cedar Funding VII CLO Ltd.        
  369,759     Series 2018-7A, 6.588%, (3-Month Term SOFR+126.16 basis points), 1/20/20311,2,3     368,555  
        CIFC Funding Ltd.        
  290,000     Series 2021-4A, 6.620%, (3-Month Term SOFR+131.16 basis points), 7/15/20331,2,3     289,481  
  250,000     Series 2014-4RA, 6.740%, (3-Month Term SOFR+143.16 basis points), 1/17/20351,2,3     248,700  
        Elmwood CLO IV Ltd.        
  250,000     Series 2020-1A, 6.810%, (3-Month Term SOFR+150.16 basis points), 4/15/20331,2,3     249,437  
        Generate CLO IV Ltd.        
  365,388     Series 4A, 6.678%, (3-Month Term SOFR+135.16 basis points), 4/20/20321,2,3     364,247  
        LCM XVIII LP        
  347,322     Series 18A, 6.608%, (3-Month Term SOFR+128.16 basis points), 4/20/20311,2,3     346,040  
        LCM XX LP        
  2,525     Series 20A, 6.628%, (3-Month Term SOFR+130.16 basis points), 10/20/20271,2,3     2,526  
        Madison Park Funding XLI Ltd.        
  135,192     Series 12A, 6.437%, (3-Month Term SOFR+109.16 basis points), 4/22/20271,2,3     135,023  
        Magnetite XII Ltd.        
  375,000     Series 2015-12A, 6.670%, (3-Month Term SOFR+136.16 basis points), 10/15/20311,2,3     374,104  

10

 

AXS First Priority CLO Bond ETF

SCHEDULE OF INVESTMENTS - Continued

As of September 30, 2023 (Unaudited)

 

 

Principal Amount         Value  
        COLLATERALIZED MORTGAGE OBLIGATIONS (Continued)        
        Palmer Square CLO Ltd.        
$ 198,828     Series 2014-1A, 6.700%, (3-Month Term SOFR+139.16 basis points), 1/17/20311,2,3   $ 198,625  
        Recette CLO Ltd.        
  250,000     Series 2015-1A, 6.668%, (3-Month Term SOFR+134.16 basis points), 4/20/20341,2,3     247,913  
        Rockford Tower CLO Ltd.        
  300,000     Series 2021-1A, 6.758%, (3-Month Term SOFR+143.16 basis points), 7/20/20341,2,3     297,648  
        Shackleton CLO IV Ltd.        
  348,882     Series 2013-4RA, 6.563%, (3-Month USD Libor+100 basis points), 4/13/20311,2,3     348,004  
        Symphony CLO XXII Ltd.        
  375,000     Series 2020-22A, 6.862%, (3-Month Term SOFR+155.16 basis points), 4/18/20331,2,3     374,071  
        Thompson Park CLO Ltd.        
  250,000     Series 2021-1A, 6.570%, (3-Month Term SOFR+126.16 basis points), 4/15/20341,2,3     248,896  
        TICP CLO IX Ltd.        
  226,056     Series 2017-9A, 6.728%, (3-Month Term SOFR+140.16 basis points), 1/20/20311,2,3     226,017  
        Vibrant CLO XI Ltd.        
  300,000     Series 2019-11A, 6.708%, (3-Month Term SOFR+138.16 basis points), 7/20/20321,2,3     297,856  
        Voya CLO Ltd.        
  375,000     Series 2018-3A, 6.720%, (3-Month Term SOFR+141.16 basis points), 10/15/20311,2,3     373,888  
        TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS        
        (Cost $6,875,408)     6,886,937  
        TOTAL INVESTMENTS — 92.3%        
        (Cost $6,875,408)     6,886,937  
        Other Assets in Excess of Liabilities — 7.7%     575,920  
        TOTAL NET ASSETS — 100.0%   $ 7,462,857  

 

LP – Limited Partnership

1 Callable.
2 Floating rate security.
3 Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities are restricted and may be resold in transactions exempt from registration normally to qualified institutional buyers. The total value of these securities is $6,886,937, which represents 92.3% of total net assets of the Fund.

 

See accompanying Notes to Financial Statements.

11

 

AXS First Priority CLO Bond ETF

SUMMARY OF INVESTMENTS

As of September 30, 2023 (Unaudited)

 

 

Security Type   Percent of Total Net Assets  
Collateralized Mortgage Obligations     92.3 %
Total Investments     92.3 %
Other Assets in Excess of Liabilities     7.7 %
Total Net Assets     100.0 %

 

See accompanying Notes to Financial Statements.

12

 

AXS Green Alpha ETF

SCHEDULE OF INVESTMENTS

As of September 30, 2023 (Unaudited)

 

 

Number of Shares         Value  
        COMMON STOCKS — 99.5%        
        AGRICULTURE — 0.3%        
  17,260     Vital Farms, Inc.*   $ 199,871  
        AUTO MANUFACTURERS — 5.0%        
  18,941     Rivian Automotive, Inc. - Class A*     459,888  
  7,452     Tesla, Inc.*     1,864,639  
  65,940     XPeng, Inc. - ADR*,1     1,210,658  
              3,535,185  
        AUTO PARTS & EQUIPMENT — 1.0%        
  107,955     QuantumScape Corp.*     722,219  
        BIOTECHNOLOGY — 13.0%        
  30,120     Arcturus Therapeutics Holdings, Inc.*     769,566  
  5,454     BioNTech S.E. - ADR*,1     592,523  
  103,146     Caribou Biosciences, Inc.*     493,038  
  56,704     CRISPR Therapeutics A.G.*,1     2,573,795  
  120,294     Editas Medicine, Inc.*     938,293  
  4,010     Illumina, Inc.*     550,493  
  20,902     Intellia Therapeutics, Inc.*     660,921  
  18,535     Moderna, Inc.*     1,914,480  
  41,202     Prime Medicine, Inc.*     393,067  
  17,567     Verve Therapeutics, Inc.*     232,938  
              9,119,114  
        BUILDING MATERIALS — 1.1%        
  12,893     Trex Co., Inc.*     794,596  
        CHEMICALS — 0.9%        
  20,220     Daqo New Energy Corp. - ADR*,1     612,059  
        COMPUTERS — 7.2%        
  4,946     Apple, Inc.     846,805  
  2,244     Crowdstrike Holdings, Inc. - Class A*     375,601  
  19,843     International Business Machines Corp.     2,783,973  
  23,848     Rapid7, Inc.*     1,091,761  
              5,098,140  
        DIVERSIFIED FINANCIAL SERVICES — 2.1%        
  70,281     Hannon Armstrong Sustainable Infrastructure Capital, Inc.     1,489,957  
        ELECTRIC — 3.0%        
  89,184     Brookfield Renewable Corp. - Class A1     2,135,065  
        ELECTRONICS — 2.1%        
  28,214     ABB Ltd. - ADR1     1,004,136  

13

 

AXS Green Alpha ETF

SCHEDULE OF INVESTMENTS - Continued

As of September 30, 2023 (Unaudited)

 

 

Number of Shares         Value  
        COMMON STOCKS (Continued)        
        ELECTRONICS (Continued)        
  4,693     Advanced Energy Industries, Inc.   $ 483,942  
              1,488,078  
        ENERGY-ALTERNATE SOURCES — 14.1%        
  42,619     Canadian Solar, Inc.*,1     1,048,854  
  4,498     Enphase Energy, Inc.*     540,435  
  10,309     First Solar, Inc.*     1,665,831  
  14,723     Fluence Energy, Inc.*     338,482  
  65,888     FREYR Battery S.A.*,1     322,192  
  43,417     JinkoSolar Holding Co., Ltd. - ADR*,1     1,318,574  
  35,538     Maxeon Solar Technologies Ltd.*,1     411,886  
  2,312     SolarEdge Technologies, Inc.*     299,427  
  82,145     SunPower Corp.*     506,835  
  27,756     Sunrun, Inc.*     348,615  
  109,419     TPI Composites, Inc.*     289,960  
  130,810     Vestas Wind Systems A/S*     2,814,852  
              9,905,943  
        ENVIRONMENTAL CONTROL — 0.7%        
  134,671     Li-Cycle Holdings Corp.*,1     478,082  
        FOOD — 3.6%        
  7,911     Danone S.A.     437,718  
  71,170     Natural Grocers by Vitamin Cottage, Inc.     918,805  
  26,693     Sprouts Farmers Market, Inc.*     1,142,460  
              2,498,983  
        HEALTHCARE-PRODUCTS — 1.8%        
  154,987     Pacific Biosciences of California, Inc.*     1,294,142  
        HEALTHCARE-SERVICES — 0.5%        
  197,993     Ginkgo Bioworks Holdings, Inc.*     358,367  
        INVESTMENT COMPANIES — 2.2%        
  132,240     Horizon Technology Finance Corp.     1,571,011  
        IRON/STEEL — 0.5%        
  7,164     Commercial Metals Co.     353,973  
        OFFICE FURNISHINGS — 1.4%        
  41,580     Interface, Inc.     407,900  
  51,623     Steelcase, Inc. - Class A     576,629  
              984,529  

14

 

AXS Green Alpha ETF

SCHEDULE OF INVESTMENTS - Continued

As of September 30, 2023 (Unaudited)

 

 

Number of Shares         Value  
        COMMON STOCKS (Continued)        
        REITS — 13.1%        
  11,192     Alexandria Real Estate Equities, Inc.   $ 1,120,319  
  14,661     Boston Properties, Inc.     872,036  
  13,443     Digital Realty Trust, Inc.     1,626,872  
  1,965     Equinix, Inc.     1,427,101  
  175,519     Hudson Pacific Properties, Inc.     1,167,201  
  27,227     Kilroy Realty Corp.     860,646  
  34,699     SL Green Realty Corp.     1,294,273  
  38,549     Vornado Realty Trust     874,291  
              9,242,739  
        SEMICONDUCTORS — 24.2%        
  3,885     Analog Devices, Inc.     680,225  
  25,961     Applied Materials, Inc.     3,594,300  
  3,931     ASML Holding N.V.1     2,314,022  
  55,356     Infineon Technologies A.G.     1,837,659  
  4,327     Lam Research Corp.     2,712,034  
  16,160     QUALCOMM, Inc.     1,794,730  
  43,079     Taiwan Semiconductor Manufacturing Co., Ltd. - ADR1     3,743,565  
  9,442     Wolfspeed, Inc.*     359,740  
              17,036,275  
        TELECOMMUNICATIONS — 1.7%        
  55,175     SK Telecom Co., Ltd. - ADR1     1,184,056  
        TOTAL COMMON STOCKS        
        (Cost $74,395,265)     70,102,384  
        TOTAL INVESTMENTS — 99.5%        
        (Cost $74,395,265)     70,102,384  
        Other Assets in Excess of Liabilities — 0.5%     339,008  
        TOTAL NET ASSETS — 100.0%   $ 70,441,392  

 

ADR – American Depository Receipt

 

* Non-income producing security.
1 Foreign security denominated in U.S. Dollars.

 

See accompanying Notes to Financial Statements.

15

 

AXS Green Alpha ETF

SUMMARY OF INVESTMENTS

As of September 30, 2023 (Unaudited)

 

 

Security Type/Industry   Percent of Total Net Assets  
Common Stocks        
Semiconductors     24.2 %
Energy-Alternate Sources     14.1 %
REITS     13.1 %
Biotechnology     13.0 %
Computers     7.2 %
Auto Manufacturers     5.0 %
Food     3.6 %
Electric     3.0 %
Investment Companies     2.2 %
Electronics     2.1 %
Diversified Financial Services     2.1 %
Healthcare-Products     1.8 %
Telecommunications     1.7 %
Office Furnishings     1.4 %
Building Materials     1.1 %
Auto Parts & Equipment     1.0 %
Chemicals     0.9 %
Environmental Control     0.7 %
Healthcare-Services     0.5 %
Iron/Steel     0.5 %
Agriculture     0.3 %
Total Common Stocks     99.5 %
Total Investments     99.5 %
Other Assets in Excess of Liabilities     0.5 %
Total Net Assets     100.0 %

 

See accompanying Notes to Financial Statements.

16

 

AXS Brendan Wood TopGun Index ETF

SCHEDULE OF INVESTMENTS

As of September 30, 2023 (Unaudited)

 

 

Number of Shares         Value  
        COMMON STOCKS — 99.6%        
        BANKS — 7.9%        
  533     JPMorgan Chase & Co.   $ 77,295  
  763     Royal Bank of Canada1     66,717  
              144,012  
        COMPUTERS — 5.4%        
  591     Crowdstrike Holdings, Inc. - Class A*     98,922  
        DIVERSIFIED FINANCIAL SERVICES — 8.7%        
  203     Mastercard, Inc. - Class A     80,370  
  340     Visa, Inc. - Class A     78,203  
              158,573  
        ENVIRONMENTAL CONTROL — 3.9%        
  533     Waste Connections, Inc.1     71,582  
        HEALTHCARE-PRODUCTS — 3.6%        
  266     Danaher Corp.     65,995  
        HEALTHCARE-SERVICES — 3.7%        
  134     UnitedHealth Group, Inc.     67,561  
        INSURANCE — 11.7%        
  492     Intact Financial Corp.     71,729  
  377     Marsh & McLennan Cos., Inc.     71,743  
  490     Progressive Corp.     68,257  
              211,729  
        INTERNET — 4.6%        
  636     Alphabet, Inc. - Class A*     83,227  
        MINING — 7.2%        
  1,365     Agnico Eagle Mines Ltd.1     62,039  
  517     Franco-Nevada Corp.1     69,015  
              131,054  
        OIL & GAS — 4.1%        
  1,480     Tourmaline Oil Corp.     74,477  
        REITS — 3.2%        
  514     Prologis, Inc.     57,676  
        RETAIL — 4.1%        
  132     Costco Wholesale Corp.     74,575  

17

 

AXS Brendan Wood TopGun Index ETF

SCHEDULE OF INVESTMENTS - Continued

As of September 30, 2023 (Unaudited)

 

 

Number of Shares         Value  
        COMMON STOCKS (Continued)        
        SEMICONDUCTORS — 7.6%        
  776     Advanced Micro Devices, Inc.*   $ 79,787  
  99     ASML Holding N.V.1     58,278  
              138,065  
        SOFTWARE — 16.1%        
  32     Constellation Software, Inc.     66,063  
  261     Microsoft Corp.     82,411  
  132     ServiceNow, Inc.*     73,782  
  461     Snowflake, Inc. - Class A*     70,427  
              292,683  
        TRANSPORTATION — 3.9%        
  945     Canadian Pacific Kansas City Ltd.1     70,317  
        VENTURE CAPITAL — 3.9%        
  2,240     Brookfield Corp.1     70,045  
        TOTAL COMMON STOCKS        
        (Cost $1,746,589)     1,810,493  
        RIGHTS — 0.0%        
        SOFTWARE — 0.0%        
  32     Constellation Software, Inc. Expiration Date: 12/31/2049     1  
        TOTAL RIGHTS        
        (Cost $19)     1  
        WARRANTS — 0.0%        
        SOFTWARE — 0.0%        
  32     Constellation Software, Inc. Expiration Date: 03/31/20402      
        TOTAL WARRANTS        
        (Cost $0)      
        TOTAL INVESTMENTS — 99.6%        
        (Cost $1,746,608)     1,810,494  
        Other Assets in Excess of Liabilities — 0.4%     6,365  
        TOTAL NET ASSETS — 100.0%   $ 1,816,859  

 

* Non-income producing security.
1 Foreign security denominated in U.S. Dollars.
2 Level 3 securities fair valued under procedures established by the Board of Trustees, represents 0.00% of Net Assets.

 The total value of these securities is $0.

 

See accompanying Notes to Financial Statements.

18

 

AXS Brendan Wood TopGun Index ETF

SUMMARY OF INVESTMENTS

As of September 30, 2023 (Unaudited)

 

 

Security Type   Percent of Total Net Assets  
Common Stocks        
Software     16.1 %
Insurance     11.7 %
Diversified Financial Services     8.7 %
Banks     7.9 %
Semiconductors     7.6 %
Mining     7.2 %
Computers     5.4 %
Internet     4.6 %
Retail     4.1 %
Oil & Gas     4.1 %
Venture Capital     3.9 %
Environmental Control     3.9 %
Transportation     3.9 %
Healthcare-Services     3.7 %
Healthcare-Products     3.6 %
REITS     3.2 %
Total Common Stocks     99.6 %
Rights        
Software     0.0 %
Total Rights     0.0 %
Warrants        
Software     0.0 %
Total Warrants     0.0 %
Total Investments     99.6 %
Other Assets in Excess of Liabilities     0.4 %
Total Net Assets     100.0 %

 

See accompanying Notes to Financial Statements.

19

 

AXS Esoterica NextG Economy ETF

SCHEDULE OF INVESTMENTS

As of September 30, 2023 (Unaudited)

 

 

Number of Shares         Value  
        COMMON STOCKS — 90.3%        
        AUTO MANUFACTURERS — 5.2%        
  3,571     Tesla, Inc.*   $ 893,536  
  11,570     XPeng, Inc. - ADR*     212,425  
              1,105,961  
        COMMERCIAL SERVICES — 0.7%        
  107     Adyen N.V.*     79,946  
  1,270     Block, Inc.*     56,210  
              136,156  
        COMPUTERS — 1.7%        
  2,316     Zscaler, Inc.*     360,346  
        INTERNET — 13.4%        
  3,030     Alphabet, Inc. - Class C*     399,505  
  8,560     Amazon.com, Inc.*     1,088,147  
  3,798     JD.com, Inc. - ADR     110,636  
  389     JD.com, Inc. - Class A     5,717  
  39,520     Meituan - Class B*     578,279  
  2,958     PDD Holdings, Inc. - ADR*     290,091  
  3,185     Sea Ltd. - ADR*     139,981  
  5,598     Tencent Holdings Ltd.     218,864  
              2,831,220  
        REAL ESTATE — 1.7%        
  23,029     KE Holdings, Inc. - ADR     357,410  
        SEMICONDUCTORS — 39.1%        
  16,157     Advanced Micro Devices, Inc.*     1,661,263  
  2,850     Applied Materials, Inc.     394,582  
  30,870     Marvell Technology, Inc.     1,670,993  
  9,280     NVIDIA Corp.     4,036,707  
  980     QUALCOMM, Inc.     108,839  
  4,882     Taiwan Semiconductor Manufacturing Co., Ltd. - ADR     424,246  
              8,296,630  
        SOFTWARE — 28.5%        
  3,214     Atlassian Corp. - Class A*     647,653  
  6,052     Cloudflare, Inc. - Class A*     381,518  
  6,634     Confluent, Inc. - Class A*     196,433  
  10,901     Datadog, Inc. - Class A*     992,972  
  5,795     Microsoft Corp.     1,829,771  
  1,742     MongoDB, Inc.*     602,488  
  1,945     Oracle Corp.     206,014  
  385     ServiceNow, Inc.*     215,200  

20

 

AXS Esoterica NextG Economy ETF

SCHEDULE OF INVESTMENTS - Continued

As of September 30, 2023 (Unaudited)

 

 

Number of Shares         Value  
        COMMON STOCKS (Continued)        
        SOFTWARE (Continued)        
  6,393     Snowflake, Inc. - Class A*   $ 976,659  
              6,048,708  
        TOTAL COMMON STOCKS        
        (Cost $20,161,655)     19,136,431  
        EXCHANGE-TRADED FUNDS — 5.5%        
  7,022     iShares 20+ Year Treasury Bond ETF*     622,781  
  5,361     iShares TIPS Bond ETF*     556,043  
        TOTAL EXCHANGE-TRADED FUNDS        
        (Cost $1,296,364)     1,178,824  
        TOTAL INVESTMENTS — 95.8%        
        (Cost $21,458,019)     20,315,255  
        Other Assets in Excess of Liabilities — 4.2%     885,203  
        TOTAL NET ASSETS — 100.0%   $ 21,200,458  

 

ADR – American Depository Receipt

ETF – Exchange-Traded Fund

 

*Non-income producing security.

 

See accompanying Notes to Financial Statements.

21

 

AXS Esoterica NextG Economy ETF

SUMMARY OF INVESTMENTS

As of September 30, 2023 (Unaudited)

 

 

Security Type/Industry   Percent of Total Net Assets  
Common Stocks        
Semiconductors     39.1 %
Software     28.5 %
Internet     13.4 %
Auto Manufacturers     5.2 %
Computers     1.7 %
Real Estate     1.7 %
Commercial Services     0.7 %
Total Common Stocks     90.3 %
Exchange-Traded Funds     5.5 %
Total Investments     95.8 %
Other Assets in Excess of Liabilities     4.2 %
Total Net Assets     100.0 %

 

See accompanying Notes to Financial Statements.

22

 

AXS Funds

STATEMENTS OF ASSETS AND LIABILITIES

As of September 30, 2023 (Unaudited)

 

 

    AXS Astoria Inflation Sensitive ETF     AXS Change Finance ESG ETF     AXS First Priority CLO Bond ETF  
Assets:                        
Investments, at value (cost $55,228,634, $116,072,990 and $6,875,408, respectively)   $ 57,326,777     $ 118,206,694     $ 6,886,937  
Cash     337,880       210,436       482,058  
Receivables:                        
Investment securities sold     597,612       1,670,587       -  
Dividends and interest     61,947       69,030       93,079  
Reclaims receivable     92,786       3,047       -  
Due from Advisor     -       -       783  
Prepaid expenses     -       -       -  
Other receivable (Note 3)     -       11,348       -  
Total assets     58,417,002       120,171,142       7,462,857  
                         
Liabilities:                        
Foreign currency due to custodian, at value (proceeds $0, $0 and $0, respectively)     -       -       -  
Payables:                        
Investment securities purchased     -       1,667,919       -  
Advisory fees     11,775       38,147       -  
Fund administration fees     -       -       -  
Transfer agent fees and expenses     -       -       -  
Custody fees     -       -       -  
Due to custodian     545,158       -       -  
Fund accounting fees     -       -       -  
Auditing fees     -       -       -  
Chief Compliance Officer fees     -       -       -  
Legal fees     -       -       -  
Trustees' fees and expenses     -       -       -  
Trustees' deferred compensation (Note 3)     -       -       -  
Shareholder reporting fees     -       -       -  
Accrued other expenses     -       -       -  
Total liabilities     556,933       1,706,066       -  
Commitments and contingencies (Note 3)                        
Net Assets   $ 57,860,069     $ 118,465,076     $ 7,462,857  
                         
Components of Net Assets:                        
Paid-in capital (par value of $0.01 per share with an unlimited number of shares authorized)   $ 67,247,876     $ 133,800,385     $ 7,564,824  
Total distributable earnings (accumulated deficit)     (9,387,807 )     (15,335,309 )     (101,967 )
Net Assets   $ 57,860,069     $ 118,465,076     $ 7,462,857  
                         
Shares of beneficial interest issued and outstanding     2,250,000       4,000,000       300,000  
Net asset value per share   $ 25.72     $ 29.62     $ 24.88  

 

See accompanying Notes to Financial Statements.

23

 

AXS Funds

STATEMENTS OF ASSETS AND LIABILITIES - Continued

As of September 30, 2023 (Unaudited)

 

 

    AXS Green Alpha ETF     AXS Brendan Wood TopGun Index ETF     AXS Esoterica NextG Economy ETF  
Assets:                        
Investments, at value (cost $74,395,265, $1,746,608 and $21,458,019, respectively)   $ 70,102,384     $ 1,810,494     $ 20,315,255  
Cash     288,406       69,076       992,455  
Receivables:                        
Investment securities sold     -       -       -  
Dividends and interest     91,047       179       3,674  
Reclaims receivable     11,972       441       -  
Due from Advisor     -       -       -  
Prepaid expenses     -       -       23  
Other receivable (Note 3)     -       -       -  
Total assets     70,493,809       1,880,190       21,311,407  
                         
Liabilities:                        
Foreign currency due to custodian, at value (proceeds $0, $0 and $47,662, respectively)     -       -       47,745  
Payables:                        
Investment securities purchased     -       -       -  
Advisory fees     52,285       240       106  
Fund administration fees     -       -       7,405  
Transfer agent fees and expenses     -       -       2,907  
Custody fees     -       -       8,163  
Due to custodian     132       63,091       -  
Fund accounting fees     -       -       14,434  
Auditing fees     -       -       7,999  
Chief Compliance Officer fees     -       -       2,248  
Legal fees     -       -       5,854  
Trustees' fees and expenses     -       -       2,722  
Trustees' deferred compensation (Note 3)     -       -       1,137  
Shareholder reporting fees     -       -       3,144  
Accrued other expenses     -       -       7,085  
Total liabilities     52,417       63,331       110,949  
Commitments and contingencies (Note 3)                        
Net Assets   $ 70,441,392     $ 1,816,859     $ 21,200,458  
                         
Components of Net Assets:                        
Paid-in capital (par value of $0.01 per share with an unlimited number of shares authorized)   $ 75,781,765     $ 1,818,436     $ 27,057,147  
Total distributable earnings (accumulated deficit)     (5,340,373 )     (1,577 )     (5,856,689 )
Net Assets   $ 70,441,392     $ 1,816,859     $ 21,200,458  
                         
Shares of beneficial interest issued and outstanding     2,500,000       60,000       475,754  
Net asset value per share   $ 28.18     $ 30.28     $ 44.56  

 

See accompanying Notes to Financial Statements.

24

 

AXS Astoria Inflation Sensitive ETF

STATEMENTS OF OPERATIONS

 

 

    For the Six Months Ended September 30, 2023 (Unaudited)  
Investment Income:        
Dividends (net of foreign withholding taxes of $43,506)   $ 989,883  
Interest     6,192  
Total investment income     996,075  
         
Expenses:        
Advisory fees     219,191  
Interest expense     156  
Total expenses     219,347  
Net investment income (loss)     776,728  
         
Realized and Unrealized Gain (Loss) on:        
Net realized gain (loss) on:        
Investments     (2,640,835 )
Investments in-kind     1,986,673  
Foreign currency transactions     (23,109 )
Net realized gain (loss)     (677,271 )
Net change in unrealized appreciation/depreciation on:        
Investments     2,367,383  
Foreign currency translations     (7,336 )
Net change in unrealized appreciation/depreciation     2,360,047  
Net realized and unrealized gain (loss)     1,682,776  
         
Net Increase (Decrease) in Net Assets from Operations   $ 2,459,504  

 

See accompanying Notes to Financial Statements.

25

 

AXS Change Finance ESG ETF

STATEMENTS OF OPERATIONS

 

 

    For the Six Months Ended September 30, 2023 (Unaudited)     For the Period Ended March 31, 2023*  
Investment Income:                
Dividends   $ 880,784     $ 1,165,148  
Interest     8,501       13,065  
Total investment income     889,285       1,178,213  
                 
Expenses:                
Advisory fees     297,249       348,093  
Interest expense     269       -  
Total expenses     297,518       348,093  
Net investment income (loss)     591,767       830,120  
                 
Realized and Unrealized Gain (Loss) on:                
Net realized gain (loss) on:                
Investments     (3,797,722 )     (4,944,138 )
Investments in-kind     4,661,726       215,696  
Net realized gain (loss)     864,004       (4,728,442 )
Net change in unrealized appreciation/depreciation on: Investments     1,583,011       6,017,674  
Net change in unrealized appreciation/depreciation     1,583,011       6,017,674  
Net increase from payments by affiliates (Note 3)     -       72,000  
Net realized and unrealized gain (loss)     2,447,015       1,361,232  
                 
Net Increase (Decrease) in Net Assets from Operations   $ 3,038,782     $ 2,191,352  

 

* Fiscal year end changed to March 31, effective February 1, 2023.

 

See accompanying Notes to Financial Statements.

26

 

AXS First Priority CLO Bond ETF

STATEMENTS OF OPERATIONS

 

 

    For the Six Months Ended September 30, 2023 (Unaudited)     For the Period Ended March 31, 2023*  
Investment Income:                
Interest   $ 242,804     $ 248,559  
Total investment income     242,804       248,559  
                 
Expenses:                
Advisory fees     9,253       12,201  
Total expenses     9,253       12,201  
Net investment income (loss)     233,551       236,358  
                 
Realized and Unrealized Gain (Loss) on:                
Net realized gain (loss) on:                
Investments     -       (15,473 )
Net realized gain (loss)     -       (15,473 )
Net change in unrealized appreciation/depreciation on:                
Investments     73,511       69,786  
Net change in unrealized appreciation/depreciation     73,511       69,786  
Net realized and unrealized gain (loss)     73,511       54,313  
                 
Net Increase (Decrease) in Net Assets from Operations   $ 307,062     $ 290,671  

 

* Fiscal year end changed to March 31, effective February 1, 2023.

 

See accompanying Notes to Financial Statements.

27

 

AXS Green Alpha ETF

STATEMENTS OF OPERATIONS

 

 

    For the Six Months Ended September 30, 2023 (Unaudited)  
Investment Income:        
Dividends (net of foreign withholding taxes of $31,496)   $ 518,145  
Interest     30,206  
Total investment income     548,351  
         
Expenses:        
Advisory fees     368,079  
Total expenses     368,079  
Net investment income (loss)     180,272  
         
Realized and Unrealized Gain (Loss) on:        
Net realized gain (loss) on:        
Investments     (1,027,219 )
Foreign currency transactions     15  
Net realized gain (loss)     (1,027,204 )
Net change in unrealized appreciation/depreciation on:        
Investments     (8,067,185 )
Foreign currency translations     (100 )
Net change in unrealized appreciation/depreciation     (8,067,285 )
Net realized and unrealized gain (loss)     (9,094,489 )
         
Net Increase (Decrease) in Net Assets from Operations   $ (8,914,217 )

 

See accompanying Notes to Financial Statements.

28

 

AXS Brendan Wood TopGun Index ETF

STATEMENTS OF OPERATIONS

 

 

    For the Six Months Ended September 30, 2023 (Unaudited)  
Investment Income:        
Dividends (net of foreign withholding taxes of $1,642)   $ 11,252  
Interest     1,511  
Total investment income     12,763  
         
Expenses:        
Advisory fees     9,015  
Interest expense     3,472  
Total expenses     12,487  
Net investment income (loss)     276  
         
Realized and Unrealized Gain (Loss) on:        
Net realized gain (loss) on:        
Investments     (43,078 )
Foreign currency transactions     314  
Net realized gain (loss)     (42,764 )
Net change in unrealized appreciation/depreciation on:        
Investments     80,040  
Foreign currency translations     (473 )
Net change in unrealized appreciation/depreciation     79,567  
Net realized and unrealized gain (loss)     36,803  
         
Net Increase (Decrease) in Net Assets from Operations   $ 37,079  

 

See accompanying Notes to Financial Statements.

29

 

AXS Esoterica NextG Economy ETF

STATEMENTS OF OPERATIONS

 

 

    For the Six Months Ended September 30, 2023 (Unaudited)     For the Period Ended March 31, 2023*  
Investment Income:                
Dividends (net of foreign withholding taxes of $1,761 and $1,769, respectively)   $ 47,654     $ 26,559  
Interest     12,489       10,505  
Total investment income     60,143       37,064  
Expenses:                
Advisory fees     78,846       54,196  
Fund administration fees     19,315       11,069  
Fund accounting fees     14,910       15,299  
Transfer agent fees and expenses     5,865       2,791  
Custody fees     11,540       3,462  
Shareholder reporting fees     8,741       4,332  
Legal fees     4,735       10,210  
Auditing fees     10,106       15,500  
Trustees' fees and expenses     2,055       7,343  
Insurance fees     26       3,694  
Chief Compliance Officer fees     4,093       11,277  
Interest expense     788       -  
Miscellaneous     4,526       14,784  
Total expenses     165,546       153,957  
Advisory fees (waived) recovered     (78,846 )     (54,196 )
Other expenses absorbed     (7,066 )     (45,551 )
Net expenses     79,634       54,210  
Net investment income (loss)     (19,491 )     (17,146 )
                 
Realized and Unrealized Gain (Loss) on:                
Net realized gain (loss) on:                
Investments     (469,666 )     (770,745 )
Investments in-kind     225,785       -  
Foreign currency transactions     (7,567 )     -  
Net realized gain (loss)     (251,448 )     (770,745 )
Net change in unrealized appreciation/depreciation on:                
Investments     2,259,681       4,130,066  
Foreign currency translations     (17,794 )     17,711  
Net change in unrealized appreciation/depreciation     2,241,887       4,147,777  
Net realized and unrealized gain (loss)     1,990,439       3,377,032  
                 
Net Increase (Decrease) in Net Assets from Operations   $ 1,970,948     $ 3,359,886  

 

* Fiscal year end changed to March 31, effective February 1, 2023.

 

See accompanying Notes to Financial Statements.

30

 

AXS Astoria Inflation Sensitive ETF

STATEMENTS OF CHANGES IN NET ASSETS

 

 

    For the Six
Months Ended
September 30, 2023 (Unaudited)
    For the Year Ended March 31, 2023  
Increase (Decrease) in Net Assets from:                
Operations:                
Net investment income (loss)   $ 776,728     $ 2,307,336  
Net realized gain (loss) on investments, investments in kind and foreign currency transactions     (677,271 )     (5,748,142 )
Net change in unrealized appreciation/depreciation on investments and foreign currency translations     2,360,047       (4,391,646 )
Net increase (decrease) in net assets resulting from operations     2,459,504       (7,832,452 )
                 
Distributions to Shareholders:                
Total distributions to shareholders     (954,175 )     (2,383,576 )
                 
Capital Transactions:                
Net proceeds from shares sold     7,511,045       57,132,883  
Cost of shares redeemed     (20,144,380 )     (39,891,398 )
Net increase (decrease) in net assets from capital transactions     (12,633,335 )     17,241,485  
                 
Total increase (decrease) in net assets     (11,128,006 )     7,025,457  
                 
Net Assets:                
Beginning of period     68,988,075       61,962,618  
End of period   $ 57,860,069     $ 68,988,075  
Capital Share Transactions:                
Shares sold     300,000       2,175,000  
Shares redeemed     (800,000 )     (1,600,000 )
Net increase (decrease) in capital share transactions     (500,000 )     575,000  

 

See accompanying Notes to Financial Statements.

31

 

AXS Change Finance ESG ETF^

STATEMENTS OF CHANGES IN NET ASSETS

 

 

    For the Six
Months Ended
September 30, 2023 (Unaudited)
    For the Period Ended March 31, 2023*     For the Year Ended July 31, 2022  
Increase (Decrease) in Net Assets from:                        
Operations:                        
Net investment income (loss)   $ 591,767     $ 830,120     $ 985,697  
Net realized gain (loss) on investments and investments in kind     864,004       (4,728,442 )     (2,957,970 )
Net change in unrealized appreciation/depreciation on investments     1,583,011       6,017,674       (16,901,094 )
Net increase from payment by affiliates (Note 3)     -       72,000       -  
Net increase (decrease) in net assets resulting from operations     3,038,782       2,191,352       (18,873,367 )
                         
Distributions to Shareholders:                        
Total distributions to shareholders     -       (1,153,807 )     (637,137 )
                         
Capital Transactions:                        
Net proceeds from shares sold     20,634,085       18,498,011       98,740,402  
Cost of shares redeemed     (22,164,805 )     (5,859,190 )     (55,991,155 )
Net increase (decrease) in net assets from capital transactions     (1,530,720 )     12,638,821       42,749,247  
                         
Total increase (decrease) in net assets     1,508,062       13,676,366       23,238,743  
                         
Net Assets:                        
Beginning of period     116,957,014       103,280,648       80,041,905  
End of period   $ 118,465,076     $ 116,957,014     $ 103,280,648  
Capital Share Transactions:                        
Shares sold     675,000       675,000       2,975,000  
Shares redeemed     (725,000 )     (225,000 )     (1,725,000 )
Net increase (decrease) in capital share transactions     (50,000 )     450,000       1,250,000  

 

^ With the Plan of Reorganization with respect to the AXS Change Finance ESG ETF (formerly, Change Finance U.S. Large Cap Fossil Fuel Free ETF), shareholders received shares of the AXS Change Finance ESG ETF effective as of the close of business on March 18, 2022. See Note 1 in the accompanying Notes to Financial Statements.
* Fiscal year end changed to March 31, effective February 1, 2023.

 

See accompanying Notes to Financial Statements.

32

 

AXS First Priority CLO Bond ETF^

STATEMENTS OF CHANGES IN NET ASSETS

 

 

    For the Six
Months Ended
September 30, 2023 (Unaudited)
    For the Period Ended March 31, 2023*     For the Year Ended July 31, 2022  
Increase (Decrease) in Net Assets from:                        
Operations:                        
Net investment income (loss)   $ 233,551     $ 236,358     $ 127,189  
Net realized gain (loss) on investments     -       (15,473 )     (136,062 )
Net change in unrealized appreciation/depreciation on investments     73,511       69,786       (160,596 )
Net increase (decrease) in net assets resulting from operations     307,062       290,671       (169,469 )
                         
Distributions to Shareholders:                        
Total distributions to shareholders     (195,512 )     (256,072 )     (118,047 )
                         
Capital Transactions:                        
Cost of shares redeemed     -       -       (2,434,390 )
Transactions fees (Note 2c)     -       -       6,086  
Net increase (decrease) in net assets from capital transactions     -       -       (2,428,304 )
                         
Total increase (decrease) in net assets     111,550       34,599       (2,715,820 )
                         
Net Assets:                        
Beginning of period     7,351,307       7,316,708       10,032,528  
End of period   $ 7,462,857     $ 7,351,307     $ 7,316,708  
Capital Share Transactions:                        
Shares redeemed     -       -       (100,000 )
Net increase (decrease) in capital share transactions     -       -       (100,000 )

 

^ With the Plan of Reorganization with respect to the AXS First Priority CLO Bond ETF (formerly, AAF First Priority CLO Bond ETF), Investor Class shareholders received Investor Class shares of the AXS First Priority CLO Bond ETF effective as of the close of business on October 14, 2022. See Note 1 in the accompanying Notes to Financial Statements.
* Fiscal year end changed to March 31, effective February 1, 2023.

 

See accompanying Notes to Financial Statements.

33

 

AXS Green Alpha ETF

STATEMENTS OF CHANGES IN NET ASSETS

 

 

    For the Six
Months Ended
September 30, 2023 (Unaudited)
    For the Period Ended March 31, 2023*  
Increase (Decrease) in Net Assets from:                
Operations:                
Net investment income (loss)   $ 180,272     $ 195,440  
Net realized gain (loss) on investments, investments in kind and foreign currency transactions     (1,027,204 )     334,578  
Net change in unrealized appreciation/depreciation on investments and foreign currency translations     (8,067,285 )     3,774,340  
Net increase (decrease) in net assets resulting from operations     (8,914,217 )     4,304,358  
                 
Distributions to Shareholders:                
Total distributions to shareholders     (350,598 )     (66,380 )
                 
Capital Transactions:                
Net proceeds from shares sold     9,771,241       67,035,896  
Cost of shares redeemed     -       (1,338,908 )
Net increase (decrease) in net assets from capital transactions     9,771,241       65,696,988  
                 
Total increase (decrease) in net assets     506,426       69,934,966  
                 
Net Assets:                
Beginning of period     69,934,966       -  
End of period   $ 70,441,392     $ 69,934,966  
Capital Share Transactions:                
Shares sold     310,000       2,230,000  
Shares redeemed     -       (40,000 )
Net increase (decrease) in capital share transactions     310,000       2,190,000  

 

* The Fund commenced operations on September 27, 2022.                

 

See accompanying Notes to Financial Statements.

34

 

AXS Brendan Wood TopGun Index ETF

STATEMENTS OF CHANGES IN NET ASSETS

 

 

    For the Six
Months Ended
September 30, 2023 (Unaudited)
    For the Period Ended March 31, 2023*  
Increase (Decrease) in Net Assets from:                
Operations:                
Net investment income (loss)   $ 276     $ 4,704  
Net realized gain (loss) on investments and foreign currency transactions     (42,764 )     (24,036 )
Net change in unrealized appreciation/depreciation on investments and foreign currency translations     79,567       (15,321 )
Net increase (decrease) in net assets resulting from operations     37,079       (34,653 )
                 
Distributions to Shareholders:                
Total distributions to shareholders     -       (4,003 )
                 
Capital Transactions:                
Net proceeds from shares sold     -       1,818,436  
Net increase (decrease) in net assets from capital transactions     -       1,818,436  
                 
Total increase (decrease) in net assets     37,079       1,779,780  
                 
Net Assets:                
Beginning of period     1,779,780       -  
End of period   $ 1,816,859     $ 1,779,780  
Capital Share Transactions:                
Shares sold     -       60,000  
Net increase (decrease) in capital share transactions     -       60,000  

 

* The Fund commenced operations on November 8, 2022.

 

See accompanying Notes to Financial Statements.

35

 

AXS Esoterica NextG Economy ETF^

STATEMENTS OF CHANGES IN NET ASSETS

 

 

    For the Six
Months Ended
September 30, 2023 (Unaudited)
    For the Period Ended March 31, 2023*     For the Year Ended October 31, 2022  
Increase (Decrease) in Net Assets from:                        
Operations:                        
Net investment income (loss)   $ (19,491 )   $ (17,146 )   $ (110,864 )
Net realized gain (loss) on investments, investments in kind and foreign currency transactions     (251,448 )     (770,745 )     (3,458,942 )
Net change in unrealized appreciation/depreciation on investments and foreign currency translations     2,241,887       4,147,777       (16,174,608 )
Net increase (decrease) in net assets resulting from operations     1,970,948       3,359,886       (19,744,414 )
Capital Transactions:                        
Net proceeds from shares sold1     3,513,032       -       1,671,569  
Cost of shares redeemed1     (4,110,840 )     -       (11,425,487 )
Transactions fees (Note 2c)     152       -       3,371  
Net increase (decrease) in net assets from capital transactions     (597,656 )     -       (9,750,547 )
                         
Total increase (decrease) in net assets     1,373,292       3,359,886       (29,494,961 )
Net Assets:                        
Beginning of period     19,827,166       16,467,280       45,962,241  
End of period   $ 21,200,458     $ 19,827,166     $ 16,467,280  
Capital Share Transactions:                        
Shares sold     75,000       -       25,000  
Shares redeemed     (100,000 )     -       (250,000 )
Net increase (decrease) in capital share transactions     (25,000 )     -       (225,000 )

 

^ With the Plan of Reorganization with respect to the AXS Esoterica NextG Economy ETF (formerly, Esoterica NextG Economy ETF), shareholders received shares of the AXS Esoterica NextG Economy ETF effective as of the close of business on December 16, 2022. See Note 1 in the accompanying Notes to Financial Statements.
* Fiscal year end changed to March 31, effective February 1, 2023.
1 For the year ended October 31, 2022, the Fund had 250,000 Shares redeemed in-kind with total cost in the amount of $11,425,487. For the year ended October 31, 2021, the Fund had 725,000 Shares contributed in-kind with total proceeds in the amount of $38,854,252 and 275,000 Shares redeemed in-kind with total cost in the amount of $15,090,555.

 

See accompanying Notes to Financial Statements.

36

 

AXS Brendan Wood TopGun Index ETF

STATEMENT OF CASH FLOWS

For the Six Months Ended September 30, 2023 (Unaudited)

 

 

Increase (Decrease) in Cash:      
Cash flows provided by (used for) operating activities:      
Net increase (decrease) in net assets resulting from operations   $ 37,079  
Adjustments to reconcile net increase (decrease) in net assets from operations to net cash provided by (used for) operating activities:        
Purchases of long-term investments     (338,156 )
Sales of long-term investments     336,538  
Return of capital dividends received     -  
(Increase) Decrease in Assets:        
Foreign currency     164,606  
Investment securities sold receivable     10,522  
Due from Advisor     4,014  
Dividends and interest receivables     1,067  
Reclaims receivable     164  
Increase (Decrease) in Liabilities:        
Due to Custodian     (110,035 )
Advisory fees payable     240  
Net realized (gain)/loss     43,078  
Net change in unrealized appreciation/depreciation     (80,041 )
Net cash provided by (used for) operating activities     69,076  
Cash flows provided by (used for) financing activities:        
Proceeds from shares sold     -  
Dividends paid to shareholders, net of reinvestments     -  
Net cash provided by (used for) financing activities     -  
         
Net Increase (Decrease) in cash     69,076  
Cash and cash equivalents        
Beginning cash balance     -  
Beginning cash held at broker     -  
Total beginning cash and cash equivalents     -  
         
Ending cash balance     69,076  
Ending cash held at broker     -  
Total ending cash and cash equivalents   $ 69,076  
Supplemental disclosure of interest expense paid   $ 4,709  

 

See accompanying Notes to Financial Statements.

37

 

AXS Astoria Inflation Sensitive ETF

FINANCIAL HIGHLGHTS

 

 

Per share operating performance.

For a capital share outstanding throughout each period.

 

    For the Six Months Ended September 30, 2023 (Unaudited)     For the Year Ended March 31, 2023     For the Period Ended March 31, 2022*  
Net asset value, beginning of period   $ 25.09     $ 28.49     $ 25.00  
Income from Investment Operations:                        
Net investment income (loss)1     0.32       0.90       0.17  
Net realized and unrealized gain (loss)     0.72       (3.45 )     3.32  
Total from investment operations     1.04       (2.55 )     3.49  
                         
Less Distributions:                        
From net investment income     (0.41 )     (0.85 )     -  
Total distributions     (0.41 )     (0.85 )     -  
Net asset value, end of period   $ 25.72     $ 25.09     $ 28.49  
                         
Total return2,3     4.18 %4      (8.72 )%     13.96 %4 
                         
Total return at market price2,5     3.95 %4     (9.06 )%     14.20 %4
                         
Ratios and Supplemental Data:                        
Net assets, end of period (in thousands)   $ 57,860     $ 68,988     $ 61,963  
Ratio of expenses to average net assets6     0.70 %7     0.70 %     0.70 %7
Ratio of net investment income (loss) to average net assets     2.48 %7     3.50 %     2.51 %7
                         
Portfolio turnover rate8     60 %4     81 %     11 %4

 

* The Fund commenced operations on December 29, 2021.
1 Based on average shares outstanding during the period.
2 Total returns do not reflect the deduction of taxes that a shareholder would pay on the Fund distributions or redemption of Fund shares.
3 Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, if any, and redemption on the last day of the period at net asset value. This percentage is not an indication of the performance of a shareholder's investment in the Fund based on market value due to the differences between the market price of the shares and the net asset value per share of the Fund.
4 Not annualized.
5 Market value total return is calculated assuming an initial investment made at market value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, if any, and redemption on the last day of the period at market value. Market value is determined by the composite closing price. Composite closing security price is defined as the last reported sale price on the NYSE Arca. The composite closing price is the last reported sale, regardless of volume, and not an average price, and may have occurred on a date prior to the close of the reporting period. Market value may be greater or less than net asset value, depending on the Fund's closing price on the NYSE Arca.
6 If interest expense had been excluded, the expense ratios would have remained unchanged for the six months ended September 30, 2023. For the periods ended March 31, 2023 and March 31, 2022, the ratios would have remained unchanged.
7 Annualized.
8 Excludes the impact of in-kind transactions related to the processing of capital share transactions in Creation Units.

 

See accompanying Notes to Financial Statements.

38

 

AXS Change Finance ESG ETF^

FINANCIAL HIGHLGHTS

 

 

Per share operating performance.

For a capital share outstanding throughout each period.

 

    For the Six Months Ended September 30, 2023 (Unaudited)     For the Period Ended March 31, 2023*     For the Year Ended July 31, 2022     For the Year Ended July 31, 2021     For the Year Ended July 31, 2020     For the Year Ended July 31, 2019  
Net asset value, beginning of period   $ 28.88     $ 28.69     $ 34.06     $ 24.44     $ 21.88     $ 19.66  
Income from Investment Operations:                                                
Net investment income (loss)1     0.15       0.22       0.29       0.25       0.29       0.30  
Net realized and unrealized gain (loss)     0.59       0.25       (5.46 )     9.54       2.47       2.13  
Net increase from payments by affiliates (Note 3)     -       0.02       -       -       -       -  
Total from investment operations     0.74       0.49       (5.17 )     9.79       2.76       2.43  
                                                 
Less Distributions:                                                
From net investment income     -       (0.30 )     (0.20 )     (0.17 )     (0.20 )     (0.21 )
Total distributions     -       (0.30 )     (0.20 )     (0.17 )     (0.20 )     (0.21 )
Net asset value, end of period   $ 29.62     $ 28.88     $ 28.69     $ 34.06     $ 24.44     $ 21.88  
                                                 
Total return2,3     2.56 %4     1.78 %4,5     (15.29 )%     40.19 %     12.69 %     12.63 %
                                                 
Total return at market price2,6     2.53 %4     1.74 %4     (15.32 )%     40.44 %     12.34 %     12.72 %
                                                 
Ratios and Supplemental Data:                                                
Net assets, end of period (in thousands)   $ 118,465     $ 116,957     $ 103,281     $ 80,042     $ 19,551     $ 8,750  
Ratio of expenses to average net assets     0.49 %7,8     0.49 %7     0.49 %     0.49 %     0.49 %     0.49 %
Ratio of net investment income (loss) to average net assets     0.98 %7     1.17 %7     0.94 %     0.82 %     1.33 %     1.48 %
Portfolio turnover rate9     40 %4     41 %4     162 %     85 %     120 %     46 %

 

^ Financial information from October 9, 2017 through March 18, 2022 is for the Change Finance ESG ETF, which was reorganized into the AXS Change Finance ESG ETF as of the close of business on March 18, 2022. See Note 1 in the accompanying Notes to Financial Statements.
* Fiscal year end changed to March 31, effective February 1, 2023.
1 Based on average shares outstanding during the period.
2 Total returns do not reflect the deduction of taxes that a shareholder would pay on the Fund distributions or redemption of Fund shares.
3 Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, if any, and redemption on the last day of the period at net asset value. This percentage is not an indication of the performance of a shareholder's investment in the Fund based on market value due to the differences between the market price of the shares and the net asset value per share of the Fund.
4 Not annualized.
5 Non-affiliate reimbursed the Fund $72,000 for errors during processing. The reimbursement had a 0.07% impact to the Fund's performance.
6 Market value total return is calculated assuming an initial investment made at market value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, if any, and redemption on the last day of the period at market value. Market value is determined by the composite closing price. Composite closing security price is defined as the last reported sale price on the NYSE Arca. The composite closing price is the last reported sale, regardless of volume, and not an average price, and may have occurred on a date prior to the close of the reporting period. Market value may be greater or less than net asset value, depending on the Fund's closing price on the NYSE Arca.
7 Annualized.
8 If interest expense had been excluded, the expense ratios would have remained unchanged for the six months ended September 30, 2023.
9 Excludes the impact of in-kind transactions related to the processing of capital share transactions in Creation Units.

 

See accompanying Notes to Financial Statements.

39

 

AXS First Priority CLO Bond ETF^

FINANCIAL HIGHLGHTS

 

 

Per share operating performance.

For a capital share outstanding throughout each period.

 

    For the Six Months Ended September 30, 2023 (Unaudited)     For the Period Ended March 31, 2023*     For the Year Ended July 31, 2022     For the Period Ended July 31, 2021**  
Net asset value, beginning of period   $ 24.50     $ 24.39     $ 25.08     $ 25.00  
Income from Investment Operations:                                
Net investment income (loss)1     0.78       0.79       0.32       0.25  
Net realized and unrealized gain (loss)     0.25       0.17       (0.74 )     0.02 2
Total from investment operations     1.03       0.96       (0.42 )     0.27  
                                 
Less Distributions:                                
From net investment income     (0.65 )     (0.85 )     (0.29 )     (0.22 )
From net realized gain     -       -       - 3     -  
Total distributions     (0.65 )     (0.85 )     (0.29 )     (0.22 )
Transaction fees1     -       -       0.02       0.03  
Net asset value, end of period   $ 24.88     $ 24.50     $ 24.39     $ 25.08  
                                 
Total return4,5     4.27 %6      4.02 %6      (1.60 )%     1.21 %6 
                                 
Total return at market price5,7     4.40 %6     4.28 %6     (1.73 )%     0.98 %6
                                 
Ratios and Supplemental Data:                                
Net assets, end of period (in thousands)   $ 7,463     $ 7,351     $ 7,317     $ 10,033  
Ratio of expenses to average net assets     0.25 %8     0.25 %8     0.25 %     0.25 %8
Ratio of net investment income (loss) to average net assets     6.31 %8     4.84 %8     1.29 %     1.11 %8
Portfolio turnover rate9     - %6     8 %6     73 %     34 %6

 

^ Financial information from September 8, 2020 through October 14, 2022 is for the First Priority CLO Bond ETF, which was reorganized into the AXS First Priority CLO Bond ETF as of the close of business on October 14, 2022. See Note 1 in the accompanying Notes to Financial Statements.
* Fiscal year end changed to March 31, effective February 1, 2023.
** The Fund commenced operations on September 8, 2020.
1 Based on average shares outstanding during the period.
2 Due to timing of capital share transactions, the per share amount of net realized and unrealized gain (loss) on investments varies from the amounts shown in the Statement of Operations.
3 Amount represents less than $0.01 per share.
4 Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, if any, and redemption on the last day of the period at net asset value. This percentage is not an indication of the performance of a shareholder's investment in the Fund based on market value due to the differences between the market price of the shares and the net asset value per share of the Fund.
5 Total returns do not reflect the deduction of taxes that a shareholder would pay on the Fund distributions or redemption of Fund shares.
6 Not annualized.
7 Market value total return is calculated assuming an initial investment made at market value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, if any, and redemption on the last day of the period at market value. Market value is determined by the composite closing price. Composite closing security price is defined as the last reported sale price on the NYSE Arca. The composite closing price is the last reported sale, regardless of volume, and not an average price, and may have occurred on a date prior to the close of the reporting period. Market value may be greater or less than net asset value, depending on the Fund's closing price on the NYSE Arca.
8 Annualized.
9 Excludes the impact of in-kind transactions related to the processing of capital share transactions in Creation Units.

 

See accompanying Notes to Financial Statements.

40

 

AXS Green Alpha ETF

FINANCIAL HIGHLGHTS

 

 

Per share operating performance.

For a capital share outstanding throughout each period.

 

    For the Six Months Ended September 30, 2023 (Unaudited)     For the Period Ended March 31, 2023*  
Net asset value, beginning of period   $ 31.93     $ 30.00  
Income from Investment Operations:                
Net investment income (loss)1     0.08       0.11  
Net realized and unrealized gain (loss)     (3.68 )     1.86  
Total from investment operations     (3.60 )     1.97  
                 
Less Distributions:                
From net investment income     (0.15 )     (0.04 )
Total distributions     (0.15 )     (0.04 )
Net asset value, end of period   $ 28.18     $ 31.93  
                 
Total return2,3     (11.31 )%4      6.57 %4
                 
Total return at market price3,5     (11.32 )%4     6.80 %4
                 
Ratios and Supplemental Data:                
Net assets, end of period (in thousands)   $ 70,441     $ 69,935  
Ratio of expenses to average net assets     1.00 %6     1.00 %6,7
Ratio of net investment income (loss) to average net assets     0.49 %6     0.68 %6
Portfolio turnover rate8     2 %4     2 %4

 

* The Fund commenced operations on September 27, 2022.
1 Based on average shares outstanding during the period.
2 Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, if any, and redemption on the last day of the period at net asset value. This percentage is not an indication of the performance of a shareholder's investment in the Fund based on market value due to the differences between the market price of the shares and the net asset value per share of the Fund.
3 Total returns do not reflect the deduction of taxes that a shareholder would pay on the Fund distributions or redemption of Fund shares.
4 Not annualized.
5 Market value total return is calculated assuming an initial investment made at market value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, if any, and redemption on the last day of the period at market value. Market value is determined by the composite closing price. Composite closing security price is defined as the last reported sale price on the NYSE Arca. The composite closing price is the last reported sale, regardless of volume, and not an average price, and may have occurred on a date prior to the close of the reporting period. Market value may be greater or less than net asset value, depending on the Fund's closing price on the NYSE Arca.
6 Annualized.
7 If interest expense had been excluded, the expense ratios would have remained unchanged for the period ended March 31, 2023.
8 Excludes the impact of in-kind transactions related to the processing of capital share transactions in Creation Units.

 

See accompanying Notes to Financial Statements.

41

 

AXS Brendan Wood TopGun Index ETF

FINANCIAL HIGHLGHTS

 

 

Per share operating performance.

For a capital share outstanding throughout each period.

 

    For the Six Months Ended September 30, 2023 (Unaudited)     For the Period Ended March 31, 2023*  
Net asset value, beginning of period   $ 29.66     $ 30.00  
Income from Investment Operations:                
Net investment income (loss)1     -       0.09  
Net realized and unrealized gain (loss)     0.62       (0.35 )
Total from investment operations     0.62       (0.26 )
                 
Less Distributions:                
From net investment income     -       (0.08 )
Total distributions     -       (0.08 )
Net asset value, end of period   $ 30.28     $ 29.66  
                 
Total return2,3     2.09 %4      (0.86 )%4
                 
Total return at market price2,5     1.95 %4     (0.69 )%4
                 
Ratios and Supplemental Data:                
Net assets, end of period (in thousands)   $ 1,817     $ 1,780  
Ratio of expenses to average net assets     1.36 %6,7     1.73 %6,7
Ratio of net investment income (loss) to average net assets     0.03 %6     0.75 %6
Portfolio turnover rate8     18 %4     51 %4

 

* The Fund commenced operations on November 8, 2022.
1 Based on average shares outstanding during the period.
2 Total returns do not reflect the deduction of taxes that a shareholder would pay on the Fund distributions or redemption of Fund shares.
3 Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, if any, and redemption on the last day of the period at net asset value. This percentage is not an indication of the performance of a shareholder's investment in the Fund based on market value due to the differences between the market price of the shares and the net asset value per share of the Fund.
4 Not annualized.
5 Market value total return is calculated assuming an initial investment made at market value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, if any, and redemption on the last day of the period at market value. Market value is determined by the composite closing price. Composite closing security price is defined as the last reported sale price on NYSE Arca, Inc. The composite closing price is the last reported sale, regardless of volume, and not an average price, and may have occurred on a date prior to the close of the reporting period. Market value may be greater or less than net asset value, depending on the Fund's closing price on NYSE Arca, Inc.
6 Annualized.
7 If interest expense had been excluded, the expense ratio would have been lowered by 0.38% for the period ended September 30, 2023 and 0.75% for the period ended March 31, 2023.
8 Excludes the impact of in-kind transactions related to the processing of capital share transactions in Creation Units.

 

See accompanying Notes to Financial Statements.

42

 

AXS Esoterica NextG Economy ETF^

FINANCIAL HIGHLGHTS

 

 

Per share operating performance.

For a capital share outstanding throughout each period.

 

    For the Six Months Ended September 30, 2023 (Unaudited)     For the Period Ended March 31, 2023*     For the Year Ended October 31, 2022     For the Year Ended October 31, 2021     For the Period Ended October 31, 2020**  
Net asset value, beginning of period   $ 39.59     $ 32.88     $ 63.33     $ 43.22     $ 25.60  
Income from Investment Operations:                                        
Net investment income (loss)1     (0.04 )     (0.03 )     (0.18 )     (0.20 )     (0.07 )
Net realized and unrealized gain (loss)     5.01       6.74       (30.28 )     20.28       17.69  
Total from investment operations     4.97       6.71       (30.46 )     20.08       17.62  
                                         
Transaction fees1     - 2      -       0.01       0.03       - 2 
Net asset value, end of period   $ 44.56     $ 39.59     $ 32.88     $ 63.33     $ 43.22  
                                         
Total return3,4     12.55 %5     20.41 %5     (48.08 )%     46.53 %     68.85 %5 
                                         
Total return at market price4,6     12.84 %5     20.26 %5     (48.05 )%     46.27 %     68.80 %5
                                         
Ratios and Supplemental Data:                                        
Net assets, end of period (in thousands)   $ 21,200     $ 19,827     $ 16,467     $ 45,962     $ 11,918  
                                         
Ratio of expenses to average net assets (including interest expense):                                        
Before fees waived and expenses absorbed/recovered     1.57 %7,8     2.13 %8     2.01 %     1.55 %     3.90 %8
After fees waived and expenses absorbed/recovered     0.76 %7,8      0.75 %8     0.75 %     0.75 %     0.75 %8
Ratio of net investment income (loss) to average net assets (including interest expense):                                        
Before fees waived and expenses absorbed/recovered     (1.00 )%8     (1.62 )%8     (1.62 )%     (1.16 )%     (3.44 )%8
After fees waived and expenses absorbed/recovered     (0.19 )%8     (0.24 )%8      (0.36 )%     (0.36 )%     (0.29 )%8
                                         
Portfolio turnover rate9     17 %5     16 %5     31 %     29 %     130 %5

 

^ Financial information from March 30, 2020 through December 16, 2022 is for the Esoterica NextG Economy ETF, which was reorganized into the AXS Esoterica NextG Economy ETF as of the close of business on December 16, 2022. See Note 1 in the accompanying Notes to Financial Statements.
* Fiscal year end changed to March 31, effective February 1, 2023.
** The Fund commenced operations on March 30, 2020.
1 Based on average shares outstanding during the period.
2 Amount represents less than $0.01 per share.
3 Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, if any, and redemption on the last day of the period at net asset value. This percentage is not an indication of the performance of a shareholder's investment in the Fund based on market value due to the differences between the market price of the shares and the net asset value per share of the Fund.
4 Total return would have been lower had fees not been waived or absorbed by the Advisor. These returns do not reflect the deduction of taxes that a shareholder would pay on the Fund distributions or redemption of Fund shares.
5 Not annualized.
6 Market value total return is calculated assuming an initial investment made at market value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, if any, and redemption on the last day of the period at market value. Market value is determined by the composite closing price. Composite closing security price is defined as the last reported sale price on the CBOE BZX Exchange, Inc. The composite closing price is the last reported sale, regardless of volume, and not an average price, and may have occurred on a date prior to the close of the reporting period. Market value may be greater or less than net asset value, depending on the Fund's closing price on the CBOE BZX Exchange, Inc.
7 If interest expense had been excluded, the expense ratios would have been lowered by 0.01% for six months ended September 30, 2023.
8 Annualized.
9 Excludes the impact of in-kind transactions related to the processing of capital share transactions in Creation Units.

 

See accompanying Notes to Financial Statements.

43

 

AXS Funds

NOTES TO FINANCIAL STATEMENTS

September 30, 2023 (Unaudited)

 

 

Note 1 – Organization 

AXS Astoria Inflation Sensitive ETF (the “Astoria Inflation Sensitive ETF”), AXS Change Finance ESG ETF (the “Change Finance ESG ETF”), AXS First Priority CLO Bond ETF (the “First Priority CLO Bond ETF”), AXS Green Alpha ETF (the “Green Alpha ETF”), AXS Brendan Wood TopGun Index ETF (the “Brendan Wood TopGun Index ETF”) and AXS Esoterica NextG Economy ETF (the “Esoterica NextG Economy ETF”) (each a “Fund” and collectively the ‘‘Funds’’) are organized as a series of Investment Managers Series Trust II, a Delaware statutory trust (the “Trust”) which is registered as an open-end management investment company under the Investment Company Act of 1940, as amended (the “1940 Act”).

 

The Astoria Inflation Sensitive ETF’s primary investment objective is to seek long-term capital appreciation in inflation-adjusted terms. The Astoria Inflation Sensitive ETF is classified as a non-diversified Fund. The Astoria Inflation Sensitive ETF is an actively managed exchange-traded fund (“ETF”). The Astoria Inflation Sensitive ETF commenced operations on December 29, 2021.

 

The Change Finance ESG ETF’s primary investment objective is to seek to track the performance, before fees and expenses, of the Change Finance Diversified Impact U.S. Large Cap Fossil Fuel Free Index. The Change Finance ESG ETF is classified as a diversified Fund. The Change Finance ESG ETF is a passively managed ETF. Effective February 1, 2023, the Change Finance ESG ETF changed fiscal and tax year ends from July 31st to March 31st.

 

The Change Finance ESG ETF commenced investment operations on March 21, 2022. Prior to that date, the Change Finance ESG ETF acquired the assets and assumed the liabilities of the Change Finance U.S. Large Cap Fossil Fuel Free ETF (the "Change Finance ESG ETF Predecessor Fund"), a series of ETF Series Solutions in a tax-free reorganization as set out in the Agreement and Plan of Reorganization. The proposed Plan of Reorganization was approved by the Trust’s Board on December 6, 2021, by the Board of ETF Series Solutions on December 13, 2021, and by beneficial owners of the Change Finance ESG ETF Predecessor Fund on March 15, 2022. The tax-free reorganization was accomplished on March 18, 2022. As a result of the reorganization, the Change Finance ESG ETF assumed the performance and accounting history of the Change Finance ESG ETF Predecessor Fund. Financial information included for the dates prior to the reorganization is that of the Change Finance ESG ETF Predecessor Fund.

 

The reorganization was accomplished by the following tax-free exchange in which each shareholder of the Change Finance ESG ETF Predecessor Fund received the same aggregate share net asset value in the corresponding classes as noted below:

 

    Shares Issued     Net Assets  
      3,850,000     $ 120,130,454  

 

The net unrealized appreciation of investments transferred was $2,026,619 as of the date of the acquisition.

 

The First Priority CLO Bond ETF’s primary investment objective is to seek capital preservation and income. The First Priority CLO Bond ETF is classified as a diversified Fund. The First Priority CLO Bond ETF is an actively managed ETF. Effective February 1, 2023, the First Priority CLO Bond ETF changed fiscal year end from July 31st to March 31st.

 

The First Priority CLO Bond ETF commenced investment operations on October 17, 2022. Prior to that date, the First Priority CLO Bond ETF acquired the assets and assumed the liabilities of the AAF First Priority CLO Bond ETF (the "First Priority CLO Bond ETF Predecessor Fund"), a series of Listed Funds Trust in a tax-free reorganization as set out in the Agreement and Plan of Reorganization. The proposed Plan of Reorganization was approved by the Trust’s Board on April 21, 2022, by the Board of Listed Funds Trust on April 13, 2022, and by beneficial owners of the First Priority CLO Bond ETF Predecessor Fund on June 21, 2022. The tax-free reorganization was accomplished on October 14, 2022. As a result of the reorganization, the First Priority CLO Bond ETF assumed the performance and accounting history of the First Priority CLO Bond ETF Predecessor Fund. Financial information included for the dates prior to the reorganization is that of the First Priority CLO Bond ETF Predecessor Fund.

44

 

AXS Funds

NOTES TO FINANCIAL STATEMENTS - Continued

September 30, 2023 (Unaudited)

 

 

The reorganization was accomplished by the following tax-free exchange in which each shareholder of the AAF First Priority CLO Bond ETF Predecessor Fund received the same aggregate share net asset value in the corresponding classes as noted below:

 

    Shares Issued     Net Assets  
      300,000     $ 7,243,274  

 

The net unrealized depreciation of investments transferred was $198,016 as of the date of the acquisition.

 

The Green Alpha ETF’s primary investment objective is to seek long-term capital appreciation. The Green Alpha ETF is classified as a diversified Fund. The Green Alpha ETF is an actively managed ETF. The Green Alpha ETF commenced operations on September 27, 2022.

 

The Brendan Wood TopGun Index ETF’s primary investment objective is to seek to track the performance, before fees and expenses, of the Brendan Wood TopGun Index. The Brendan Wood TopGun Index ETF is classified as a non-diversified Fund. The Brendan Wood TopGun Index ETF is a passively managed ETF. The Brendan Wood TopGun Index ETF commenced operations on November 8, 2022.

 

The Esoterica NextG Economy ETF’s primary investment objective is to seek capital appreciation. The Esoterica NextG Economy ETF is an actively managed ETF. The Esoterica NextG Economy ETF is a non-diversified fund. Effective February 1, 2023, the Esoterica NextG Economy ETF changed fiscal year end from October 31st to March 31st.

 

The Esoterica NextG Economy ETF commenced investment operations on December 19, 2022. Prior to that date, the Esoterica NextG Economy ETF acquired the assets and assumed the liabilities of the Esoterica NextG Economy ETF (the "Esoterica NextG Economy ETF Predecessor Fund"), a series of Listed Funds Trust in a tax-free reorganization as set out in the Agreement and Plan of Reorganization. The proposed Plan of Reorganization was approved by the Trust’s Board on October 18, 2022, by the Esoterica Thematic Trust on October 13, 2022, and by beneficial owners of the Esoterica NextG Economy ETF Predecessor Fund on December 15, 2022. The tax-free reorganization was accomplished on December 16, 2022. As a result of the reorganization, the Esoterica NextG Economy ETF assumed the performance and accounting history of the Esoterica NextG Economy ETF Predecessor Fund. Financial information included for the dates prior to the reorganization is that of the Esoterica NextG Economy ETF Predecessor Fund.

 

The reorganization was accomplished by the following tax-free exchange in which each shareholder of the Esoterica NextG Economy ETF Predecessor Fund received the same aggregate share net asset value in the corresponding classes as noted below:

 

    Shares Issued     Net Assets  
      500,754     $ 16,579,393  

 

The net unrealized depreciation of investments transferred was $7,610,299 as of the date of the acquisition.

45

 

AXS Funds

NOTES TO FINANCIAL STATEMENTS - Continued

September 30, 2023 (Unaudited)

 

 

Each Fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standard Codification Topic 946 “Financial Services—Investment Companies.”

 

Note 2 – Accounting Policies 

The following is a summary of the significant accounting policies consistently followed by the Funds in the preparation of their financial statements. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from these estimates.

 

(a) Valuation of Investments 

The Funds value equity securities at the last reported sale price on the principal exchange or in the principal over the counter (“OTC”) market in which such securities are traded, as of the close of regular trading on the NYSE on the day the securities are being valued or, if the last-quoted sales price is not readily available, the securities will be valued at the last bid or the mean between the last available bid and ask price. Securities traded on the NASDAQ are valued at the NASDAQ Official Closing Price (“NOCP”). Investments in open-end investment companies are valued at the daily closing net asset value of the respective investment company. Debt securities are valued by utilizing a price supplied by independent pricing service providers. The independent pricing service providers may use various valuation methodologies including matrix pricing and other analytical pricing models as well as market transactions and dealer quotations. These models generally consider such factors as yields or prices of bonds of comparable quality, type of issue, coupon, maturity, ratings and general market conditions. If a price is not readily available for a portfolio security, the security will be valued at fair value (the amount which the Funds might reasonably expect to receive for the security upon its current sale). The Board of Trustees has designated the Advisor as the Funds’ valuation designee (the “Valuation Designee”) to make all fair value determinations with respect to the Funds’ portfolio investments, subject to the Board’s oversight. As the Valuation Designee, the Advisor has adopted and implemented policies and procedures to be followed when the Funds must utilize fair value pricing. Prior to September 8, 2022, security valued at fair value as determined in good faith by the Funds’ advisor, subject to review and approval by the Valuation Committee, pursuant to procedures adopted by the Board of Trustees. The actions of the Valuation Committee were subsequently reviewed by the Board at its next regularly scheduled board meeting. The Valuation Committee met as needed. The Valuation Committee was comprised of all the Trustees, but action may had been taken by any one of the Trustees.

 

Foreign securities traded in countries outside the U.S. are fair valued by utilizing the quotations of an independent pricing service. The pricing service uses statistical analyses and quantitative models to adjust local prices using factors such as subsequent movement and changes in the prices of indexes, securities and exchange rates in other markets in determining fair value as of the time the Funds calculate the NAVs. The Board reviews the independent third party fair valuation analysis report quarterly.

 

(b) Investment Transactions, Investment Income and Expenses 

Investment transactions are accounted for on the trade date. Realized gains and losses on investments are determined on the identified cost basis. Dividend income is recorded net of applicable withholding taxes on the ex-dividend date and interest income is recorded on an accrual basis. Withholding taxes on foreign dividends, if applicable, are paid (a portion of which may be reclaimable) or provided for in accordance with the applicable country’s tax rules and rates and are disclosed in the Statement of Operations. Withholding tax reclaims are filed in certain countries to recover a portion of the amounts previously withheld. The Funds record a reclaim receivable based on a number of factors, including a jurisdiction’s legal obligation to pay reclaims as well as payment history and market convention. Discounts on debt securities are accreted or amortized to interest income over the lives of the respective securities using the effective interest method. Premiums for callable debt securities are amortized to the earliest call date, if the call price was less than the purchase price. If the call price was not at par and the security was not called, the security is amortized to the next call price and date.

46

 

AXS Funds

NOTES TO FINANCIAL STATEMENTS - Continued

September 30, 2023 (Unaudited)

 

 

(c) Capital Share Transactions 

Fund Shares are listed and traded on the Exchange on each day that the Exchange is open for business (“Business Day”). Individual Fund Shares may only be purchased and sold on the Exchange through a broker-dealer. Because the Funds’ Shares trade at market prices rather than at their NAV, Shares may trade at a price equal to the NAV, greater than NAV (premium) or less than NAV (discount).

 

The Funds offer and redeem Shares on a continuous basis at NAV only in large blocks of Shares, currently 25,000 Shares for the Astoria Inflation Sensitive ETF, Change Finance ESG ETF and Esoterica NextG Economy ETF, 100,000 Shares for the First Priority CLO Bond ETF and 10,000 Shares for the Green Alpha ETF and Brendan Wood TopGun Index ETF, respectively (“Creation Unit”). Except when aggregated in Creation Units, Shares are not redeemable securities of the Funds. Fund Shares may only be purchased from or redeemed to the Funds by certain financial institutions (“Authorized Participants”). An Authorized Participant is either (i) a broker-dealer or other participant in the clearing process through the Continuous Net Settlement System of the National Securities Clearing Corporation or (ii) a Depository Trust Company (“DTC”) participant and, in each case, must have executed a Participant Agreement with the Distributor. Creation Units are available for purchase and redemption on each Business Day and are offered and redeemed on an in-kind basis, together with the specified cash amount, or for an all cash amount.

 

To the extent contemplated by a participant agreement, in the event an Authorized Participant has submitted a redemption request in proper form but is unable to transfer all or part of the shares comprising a Creation Unit to be redeemed by the Distributor, on behalf of the Funds, by the time as set forth in a participant agreement, the Distributor may nonetheless accept the redemption request in reliance on the undertaking by the Authorized Participant to deliver the missing shares as soon as possible, which undertaking shall be secured by the Authorized Participant’s delivery and maintenance of collateral equal to a percentage of the market value as set forth in the Participant Agreement. A participant agreement may permit the Funds to use such collateral to purchase the missing shares, and could subject an Authorized Participant to liability for any shortfall between the cost of the Funds acquiring such shares and the value of the collateral.

 

Most retail investors will not qualify as Authorized Participants or have the resources to buy and sell whole Creation Units. Therefore, they will be unable to purchase or redeem the Shares directly from the Funds. Rather, most retail investors will purchase Shares in the secondary market with the assistance of a broker, which will be subject to customary brokerage commissions or fees.

 

A fixed purchase (i.e., creation) transaction fee is imposed for the transfer and other transaction costs associated with the purchase of Creation Units, and investors will be required to pay a creation transaction fee regardless of the number of Creation Units created in the transaction. The Funds may adjust the creation transaction fee from time to time based upon actual experience. In addition, a variable fee may be imposed for cash purchases, non-standard orders, or partial cash purchases of Creation Units. The variable fee is primarily designed to cover non-standard charges, e.g., brokerage, taxes, foreign exchange, execution, market impact, and other costs and expenses, related to the execution of trades resulting from such transaction. The Funds may adjust the non-standard charge from time to time based upon actual experience. Investors who use the services of an Authorized Participant, broker or other such intermediary may be charged a fee for such services which may include an amount for the creation transaction fee and non-standard charges. Investors are responsible for the costs of transferring the securities constituting the deposit securities to the account of the Trust. The Adviser may retain all or a portion of the transaction fee to the extent the Adviser bears the expenses that otherwise would be borne by the Trust in connection with the issuance of a Creation Unit, which the transaction fee is designed to cover. The standard Creation Unit transaction fee for the Astoria Inflation Sensitive ETF, Change Finance ESG ETF, First Priority CLO Bond ETF, Green Alpha ETF, Brendan Wood TopGun Index ETF and Esoterica NextG Economy ETF is $350, $350, $100, $100, $100 and $500, respectively, regardless of the number of Creation Units created in the transaction.

47

 

AXS Funds

NOTES TO FINANCIAL STATEMENTS - Continued

September 30, 2023 (Unaudited)

 

 

A fixed redemption transaction fee may be imposed for the transfer and other transaction costs associated with the redemption of Creation Units, and Authorized Participants will be required to pay a redemption transaction fee regardless of the number of Creation Units created in the transaction. The redemption transaction fee is the same no matter how many Creation Units are being redeemed pursuant to any one redemption request. The Funds may adjust the redemption transaction fee from time to time based upon actual experience. In addition, a variable fee, payable to the Funds, may be imposed for cash redemptions, non-standard orders, or partial cash redemptions for the Funds. The variable fee is primarily designed to cover non-standard charges, e.g., brokerage, taxes, foreign exchange, execution, market impact, and other costs and expenses, related to the execution of trades resulting from such transaction. Investors who use the services of an Authorized Participant, broker or other such intermediary may be charged a fee for such services which may include an amount for the redemption transaction fees and non-standard charges. Investors are responsible for the costs of transferring the securities constituting the Funds securities to the account of the Trust. The non-standard charges are payable to the Funds as it incurs costs in connection with the redemption of Creation Units, the receipt of Funds securities and the cash redemption amount and other transactions costs. The standard redemption transaction fee for the Astoria Inflation Sensitive ETF, Change Finance ESG ETF, First Priority CLO Bond ETF, Green Alpha ETF, Brendan Wood TopGun Index ETF and Esoterica NextG Economy ETF is $350, $350, $100, $100, $100 and $500, respectively, regardless of the number of Creation Units redeemed in the transaction.

 

(d) Foreign Currency Translation 

The Funds’ records are maintained in U.S. dollars. The value of securities, currencies and other assets and liabilities denominated in currencies other than U.S. dollars are translated into U.S. dollars based upon foreign exchange rates prevailing at the end of the reporting period. The currencies are translated into U.S. dollars by using the exchange rates quoted as of 4:00 PM Eastern Standard Time. Purchases and sales of investment securities, income and expenses are translated on the respective dates of such transactions.

 

The Funds do not isolate that portion of its net realized and unrealized gains and losses on investments resulting from changes in foreign exchange rates from the impact arising from changes in market prices. Such fluctuations are included with net realized and unrealized gain or loss from investments and foreign currency.

 

Net realized foreign currency transaction gains and losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions, and the differences between the amounts of dividends, interest, and foreign withholding taxes recorded on the Funds’ books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency translation gains and losses arise from changes in the value of assets and liabilities, other than investments in securities, resulting from changes in the exchange rates.

 

(e) Federal Income Taxes 

The Funds intend to comply with the requirements of Subchapter M of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its net investment income and any net realized gains to its shareholders. Therefore, no provision is made for federal income or excise taxes. Due to the timing of dividend distributions and the differences in accounting for income and realized gains and losses for financial statement and federal income tax purposes, the fiscal year in which amounts are distributed may differ from the year in which the income and realized gains and losses are recorded by the Funds.

48

 

AXS Funds

NOTES TO FINANCIAL STATEMENTS - Continued

September 30, 2023 (Unaudited)

 

 

Accounting for Uncertainty in Income Taxes (the “Income Tax Statement”) requires an evaluation of tax positions taken (or expected to be taken) in the course of preparing a Funds’ tax returns to determine whether these positions meet a “more-likely-than-not” standard that, based on the technical merits, have a more than fifty percent likelihood of being sustained by a taxing authority upon examination. A tax position that meets the “more-likely-than-not” recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. The Funds recognize interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the Statement of Operations.

 

The Income Tax Statement requires management of the Funds to analyze tax positions taken in the prior three open tax years, if any, and tax positions expected to be taken in the Funds’ current tax year, as defined by the IRS statute of limitations for all major jurisdictions, including federal tax authorities and certain state tax authorities. As of September 30, 2023, and during the prior open tax years, the Funds did not have a liability for any unrecognized tax benefits. The Funds have no examination in progress and are not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.

 

(f) Distributions to Shareholders 

The Funds will make distributions of net investment income per the table below and net capital gains, if any, at least annually. Distributions to shareholders are recorded on the ex-dividend date. The amount and timing of distributions are determined in accordance with federal income tax regulations, which may differ from GAAP.

 

  Distribution Frequency of
  Net Investment Income
Astoria Inflation Sensitive ETF Quarterly
Change Finance ESG ETF Annually
First Priority CLO Bond ETF Monthly
Green Alpha ETF Quarterly
Brendan Wood TopGun Index ETF Annually
Esoterica NextG Economy ETF Annually

 

The character of distributions made during the year from net investment income or net realized gains may differ from the characterization for federal income tax purposes due to differences in the recognition of income, expense and gain (loss) items for financial statement and tax purposes.

 

(g) Illiquid Securities 

Pursuant to Rule 22e-4 under the 1940 Act, the Funds have adopted a Liquidity Risk Management Program (“LRMP”) that requires, among other things, that the Funds limit its illiquid investments that are assets to no more than 15% of net assets. An illiquid investment is any security which may not reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment. If the Advisor, at any time, determines that the value of illiquid securities held by the Funds exceed 15% of its NAV, the Advisor will take such steps as it considers appropriate to reduce them as soon as reasonably practicable in accordance with the Funds’ written LRMP.

49

 

AXS Funds

NOTES TO FINANCIAL STATEMENTS - Continued

September 30, 2023 (Unaudited)

 

 

(h) Exchange Traded Funds (ETFs) 

ETFs typically trade on securities exchanges and their shares may, at times, trade at a premium or discount to their net asset values. In addition, an ETF may not replicate exactly the performance of the benchmark index it seeks to track for a number of reasons, including transaction costs incurred by the ETF, the temporary unavailability of certain index securities in the secondary market or discrepancies between the ETF and the index with respect to the weighting of securities or the number of securities held. Investing in ETFs, which are investment companies, may involve duplication of advisory fees and certain other expenses. As a result, Fund shareholders indirectly bear their proportionate share of these acquired expenses. Therefore, the cost of investing in the Funds will be higher than the cost of investing directly in ETFs and may be higher than other mutual funds that invest directly in securities.

 

Each ETF in which the Funds invest is subject to specific risks, depending on the nature of the ETF. Each ETF is subject to the risks associated with direct ownership of the securities comprising the index on which the ETF is based. These risks could include liquidity risk, sector risk as well as risks associated with fixed-income securities.

 

Note 3 – Investment Advisory and Other Agreements 

The Trust, on behalf of each Fund, entered into an Investment Advisory Agreement (the “Agreement”) with AXS Investments LLC (the “Advisor”). Under the terms of the Agreement, the Funds pay a monthly investment advisory fee to the Advisor based on each Fund’s average daily net assets. The annual rates are listed in the table below:

 

  Investment Advisory Fees
Astoria Inflation Sensitive ETF 0.70%
Change Finance ESG ETF 0.49%
First Priority CLO Bond ETF  0.25%
Green Alpha ETF 1.00%
Brendan Wood TopGun Index ETF 0.98%
Esoterica NextG Economy ETF 0.75%

 

The Advisor has agreed to pay all expenses of the Astoria Inflation Sensitive ETF, Change Finance ESG ETF, First Priority CLO Bond ETF, Green Alpha ETF and Brendan Wood TopGun Index ETF except for the advisory fee, interest, dividends and other expenses on securities sold short, taxes, brokerage commissions and other expenses incurred in placing or settlement of orders for the purchase and sale of securities and other investment instruments, acquired fund fees and expenses, accrued deferred tax liability, extraordinary expenses, and distribution fees and expenses paid under any distribution plan adopted pursuant to Rule 12b-1 under the 1940 Act.

 

Prior to the close of business on December 16, 2022, investment advisory services were provided to the Esoterica NextG Economy ETF Predecessor Fund by Esoterica Capital LLC (“Esoterica” or “Sub-Advisor”), which received investment management fees for its services pursuant to the terms of the investment advisory agreements for the Fund’s Predecessor Fund’s. The investment advisory fees, which were computed and accrued daily and paid monthly, at an annual rate of 0.75% of the Funds’ average daily net assets. For the period December 17, 2022 through March 31, 2023, the Esoterica NextG Economy ETF paid the Advisor $38,285. For the period November 1, 2022 through December 16, 2022, the NextG Economy ETF Predecessor Fund paid Esoterica $15,911.

 

The Advisor has contractually agreed to waive its fee and, if necessary, to absorb other operating expenses to ensure that total annual operating expenses (excluding any taxes, leverage interest, brokerage commissions, dividend and interest expenses on short sales, acquired fund fees and expenses as determined in accordance with Form N-1A, other fees related to underlying investments (such as option fees and expenses or swap fees and expenses), expenses incurred in connection with any merger or reorganization, and extraordinary expenses such as litigation expenses) in order to limit total annual operating expenses of each fund. This agreement is in effect until December 16, 2024 for the Esoterica NextG Economy ETF and it may be terminated before that date only by the Trust’s Board of Trustees. The table below contains the expense cap by Fund:

50

 

AXS Funds

NOTES TO FINANCIAL STATEMENTS - Continued

September 30, 2023 (Unaudited)

 

 

  Total Limit on Annual
  Operating Expenses
Esoterica NextG Economy ETF 0.75%

 

The Advisor is permitted to seek reimbursement from the Fund, subject to certain limitations, of fees waived or payments made to the Fund for a period of three years after the date of the waiver or payment. This reimbursement may be requested from the Fund if the reimbursement will not cause the Esoterica NextG Economy ETF’s annual expense ratio to exceed the lesser of (a) the expense limitation amount in effect at the time such fees were waived or payments made, or (b) the expense limitation amount in effect at the time of the reimbursement. The Advisor may recapture all or a portion of this amount no later than the years stated below:

 

    Esoterica NextG
Economy ETF
 
March 31, 2026   $ 51,804  
March 31, 2027     85,912  
Total   $ 137,716  

 

For the period November 1, 2022 through December 16, 2022, Esoterica waived advisory fees and other expenses absorbed totaling $47,943 for the Esoterica NextG Economy ETF Predecessor Fund. These amounts are not recoupable.

 

The Advisor has engaged Astoria Portfolio Advisors LLC (“Astoria”) to manage the Astoria Inflation Sensitive ETF’s overall investment program and pays Astoria an annual sub-advisory fee based upon the Astoria Inflation Sensitive ETF’s average daily net assets. The Advisor is responsible for paying the entire amount of Astoria’s sub-advisory fee. The Astoria Inflation Sensitive ETF does not directly pay the Sub-Advisor.

 

The Advisor has engaged Change Finance, PBC (“Change Finance” or the “Sub-Advisor”) to manage the Change Finance ESG ETF’s overall investment program and pays Change Finance an annual sub-advisory fee based upon the Change Finance ESG ETF’s investment advisory fees. The Advisor is responsible for paying the entire amount of Change Finance’s sub-advisory fee. The Change Finance ESG ETF does not directly pay the Sub-Advisor.

 

The Advisor has engaged Alternative Access Funds, LLC (“AAF” or the “Sub-Advisor”) to manage the First Priority CLO Bond ETF’s overall investment program and pays AAF an annual sub-advisory fee based upon the First Priority CLO Bond ETF’s investment advisory fees. The Advisor is responsible for paying the entire amount of AAF’s sub-advisory fee. The First Priority CLO Bond ETF does not directly pay the Sub-Advisor.

 

The Advisor has engaged Green Alpha Advisors, LLC (“Green Alpha”) to manage the Green Alpha ETF’s overall investment program and pays Green Alpha an annual sub-advisory fee based upon the Green Alpha ETF’s investment advisory fees. The Advisor is responsible for paying the entire amount of Green Alpha’s sub-advisory fee. The Green Alpha ETF does not directly pay the Sub-Advisor.

51

 

AXS Funds

NOTES TO FINANCIAL STATEMENTS - Continued

September 30, 2023 (Unaudited)

 

 

The Advisor has engaged Esoterica to manage the Esoterica NextG Economy ETF’s overall investment program and pays Esoterica an annual sub-advisory fee based upon the Esoterica NextG Economy ETF’s investment advisory fees. The Advisor is responsible for paying the entire amount of Esoterica’s sub-advisory fee. The Esoterica NextG Economy ETF does not directly pay the Sub-Advisor.

 

Brown Brothers Harriman & Co. (“BBH”) serves as the Funds’ fund accountant, transfer agent and custodian. UMB Fund Services (“UMBFS”) and Mutual Fund Administration, LLC (“MFAC”) serve as the Funds’ co-administrators.

 

ALPS Distributors, Inc. serves as the Funds’ Distributor (the “Distributor”). The Distributor does not receive compensation from the Funds for its distribution services; the Advisor pays the Distributor a fee for its distribution-related services.

 

Certain trustees and officers of the Trust are employees of UMBFS or MFAC. The Funds do not compensate trustees and officers affiliated with the Funds’ co-administrators. For the six months ended September 30, 2023, the Funds’ allocated fees incurred to Trustees who are not affiliated with the Funds’ co-administrators are reported on the Statements of Operations.

 

The Funds’ Board of Trustees has adopted a Deferred Compensation Plan (the “Plan”) for the Independent Trustees that enables Trustees to elect to receive payment in cash or the option to select various Fund in the Trust in which their deferred accounts shall be deemed to be invested. If a trustee elects to defer payment, the Plan provides for the creation of a deferred payment account. The Funds’ liability for these amounts are adjusted for market value changes in the invested Fund and remains a liability to the Fund until distributed in accordance with the Plan. The Trustees Deferred compensation liability under the Plan constitutes a general unsecured obligation of the Funds and are disclosed in the Statements of Assets and Liabilities. Contributions made under the plan and the change in unrealized appreciation (depreciation) and income are included in the Trustees' fees and expenses in the Statements of Operations.

 

Dziura Compliance Consulting, LLC provides Chief Compliance Officer (“CCO”) services to the Trust.

 

During the period ended March 31, 2023, the index calculation agent agreed to reimburse Change Finance ESG ETF Predecessor Fund $72,000 for losses from an index calculation error. This amount is reported on the Change Finance ESG ETF's Statements of Changes and Financial Highlights under the caption “Net increase from payments by non-affiliate.” This reimbursement had a 0.07% increase to the Fund's total return. As of March 31, 2023, the Change Finance ESG ETF Predecessor Fund received $50,000. An additional $10,652 was received on May 30, 2023. The remaining balance of $11,348 is reported as other receivable on the Statements of Assets and Liabilities.

52

 

AXS Funds

NOTES TO FINANCIAL STATEMENTS - Continued

September 30, 2023 (Unaudited)

 

 

Note 4 – Federal Income Taxes 

At September 30, 2023, gross unrealized appreciation and depreciation on investments owned by the Funds, based on cost for federal income tax purposes were as follows:

 

    Astoria Inflation Sensitive ETF     Change Finance ESG ETF     First Priority CLO Bond ETF  
Cost of investments   $ 55,279,642     $ 118,269,181     $ 6,875,408  
                         
Gross unrealized appreciation   $ 3,885,028     $ 9,368,236     $ 26,485  
Gross unrealized depreciation     (1,837,893 )     (9,430,723 )     (14,956 )
Net unrealized appreciation (depreciation) on investments   $ 2,047,135     $ (62,487 )   $ 11,529  

 

    Green Alpha ETF     Brendan Wood TopGun Index ETF     Esoterica NextG Economy ETF  
Cost of investments   $ 74,395,265     $ 1,746,670     $ 21,519,629  
                         
Gross unrealized appreciation   $ 8,437,388     $ 124,834     $ 2,949,940  
Gross unrealized depreciation     (12,730,269 )     (61,010 )     (4,154,314 )
Net unrealized appreciation (depreciation) on investments   $ (4,292,881 )   $ 63,824     $ (1,204,374 )

 

The difference between cost amounts for financial statement and federal income tax purposes is due primarily to timing differences in recognizing certain gains and losses in security transactions.

 

As of March 31, 2023, the components of accumulated earnings (deficit) on a tax basis were as follows:

 

    Astoria Inflation Sensitive ETF     Change Finance ESG ETF     First Priority CLO Bond ETF  
Undistributed ordinary income   $ 165,630     $ 304,240     $ -  
Undistributed long-term capital gains     -       -       -  
Tax distributable earnings     165,630       304,240       -  
                         
Accumulated capital and other losses     (10,739,428 )     (17,032,833 )     (151,535 )
                         
Net unrealized appreciation (depreciation) on investments     (320,248 )     (1,645,498 )     (61,982 )
Net unrealized appreciation (depreciation) on foreign currency translations     910       -       -  
Unrealized deferred compensation     -       -       -  
Total distributable earnings (deficit)   $ (10,893,136 )   $ (18,374,091 )   $ (213,517 )

53

 

AXS Funds

NOTES TO FINANCIAL STATEMENTS - Continued

September 30, 2023 (Unaudited)

 

 

    Green Alpha ETF     Brendan Wood TopGun Index ETF     Esoterica NextG Economy ETF  
Undistributed ordinary income   $ 151,543     $ 701     $ -  
Undistributed long-term capital gains     12,576       -       -  
Tax distributable earnings     164,119       701       -  
                         
Accumulated capital and other losses     -       (23,974 )     (4,381,023 )
                         
Net unrealized appreciation (depreciation) on investments     3,760,287       (16,216 )     (3,464,055 )
Net unrealized appreciation (depreciation) on foreign currency translations     36       833       17,711  
Unrealized deferred compensation     -       -       (270 )
Total distributable earnings (deficit)   $ 3,924,442     $ (38,656 )   $ (7,827,637 )

 

As of the tax year ended March 31, 2023, the Fund had non-expiring accumulated capital loss carryforwards as follows:

 

Fund   Short-Term     Long-Term     Total  
Astoria Inflation Sensitive ETF   $ 9,473,380     $ 1,266,048     $ 10,739,428  
Change Finance ESG ETF     15,663,790       1,369,043       17,032,833  
First Priority CLO Bond ETF     136,066       15,469       151,535  
Brendan Wood TopGun Index ETF     23,974       -       23,974  
Esoterica NextG Economy ETF     458,868       3,909,908       4,368,776  

 

To the extent that a fund may realize future net capital gains, those gains will be offset by any of its unused capital loss carryforward. Future capital loss carryover utilization in any given year may be subject to Internal Revenue Code limitations.

 

As of March 31, 2023, the Esoterica NextG Economy ETF had $12,247 of qualified late-year ordinary losses, which are deferred until fiscal year 2023 for tax purposes net late-year ordinary losses incurred after December 31 and within the taxable year and net late-year specified losses incurred after October 31 and within the taxable year are deemed to arise on the first day of the Esoterica NextG Economy ETF’s next taxable year.

 

The tax character of distributions paid during the periods ended March 31, 2023 and 2022, October 31, 2022 and 2021 and July 31, 2022 and 2021 was as follows:

 

Astoria Inflation Sensitive ETF
    2023     2022  
Distributions paid from:                
Ordinary income   $ 2,383,576     $ -  
Net long-term capital gains     -       -  
Total distributions paid   $ 2,383,576     $ -  

54

 

AXS Funds

NOTES TO FINANCIAL STATEMENTS - Continued

September 30, 2023 (Unaudited)

 

 

 

Change Finance ESG ETF
    March 31, 2023     July 31, 2022     July 31, 2021  
Distributions paid from:                        
Ordinary income   $ 1,153,807     $ 637,137     $ 192,961  
Net long-term capital gains     -       -       -  
Total distributions paid   $ 1,153,807     $ 637,137     $ 192,961  

 

First Priority CLO Bond ETF  
    March 31, 2023     July 31, 2022     July 31, 2021  
Distributions paid from:                        
Ordinary income   $ 256,072     $ 118,047     $ 86,767  
Net long-term capital gains     -       -       -  
Total distributions paid   $ 256,072     $ 118,047       86,767  

 

Green Alpha ETF
    2023  
Distributions paid from:        
Ordinary income   $ 66,380  
Net long-term capital gains     -  
Total distributions paid   $ 66,380  

 

Brendan Wood TopGun Index ETF
    2023  
Distributions paid from:        
Ordinary income   $ 4,003  
Net long-term capital gains     -  
Total distributions paid   $ 4,003  

 

Esoterica NextG Economy ETF  
    March 31, 2023     October 31, 2022     October 31, 2021  
Distributions paid from:                        
Ordinary income   $ -     $ -     $ -  
Net long-term capital gains     -       -       -  
Total distributions paid   $ -     $ -     $ -  

 

Note 5 – Investment Transactions 

Purchases and sales of investments, excluding in-kind transactions and short-term investments, for the six months ended September 30, 2023, were as follows:

 

Fund   Purchases     Sales  
Astoria Inflation Sensitive ETF   $ 37,004,856     $ 37,773,800  
Change Finance ESG ETF     48,341,562       47,479,715  
First Priority CLO Bond ETF     -       381,401  
Green Alpha ETF     2,618,335       1,358,273  
Brendan Wood TopGun Index ETF     338,156       336,538  
Esoterica NextG Economy ETF     3,604,152       3,376,980  

55

 

AXS Funds

NOTES TO FINANCIAL STATEMENTS - Continued

September 30, 2023 (Unaudited)

 

 

Purchases, sales, and realized gain/(loss) of in-kind transactions for the six months ended September 30, 2023, were as follows:

 

Fund   Purchases     Sales     Gain/(Loss)  
Astoria Inflation Sensitive ETF   $ 7,437,722     $ 19,496,659     $ 1,986,674  
Change Finance ESG ETF     20,502,921       22,048,582       4,661,726  
Green Alpha ETF     9,318,907       -       -  
Esoterica NextG Economy ETF     3,231,362       3,913,774       225,785  

 

Note 6 – Distribution and Service Plan 

The Trust has adopted a Rule 12b-1 Distribution and Service Plan (the “Distribution and Service Plan”) pursuant to which payments of up to a maximum of 0.25% of average daily net assets may be made to compensate or reimburse financial intermediaries for activities principally intended to result in the sale of the Funds’ Shares. In accordance with the Distribution and Service Plan, the Distributor may enter into agreements with financial intermediaries and dealers relating to distribution and/or marketing services with respect to the Trust. The Board of Trustees has not authorized the Funds to make payments under the Distribution and Service Plan.  Currently, no payment is being made by the Funds.

 

Note 7 – Indemnifications 

In the normal course of business, the Funds enter into contracts that contain a variety of representations which provide general indemnifications. The Funds’ maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Funds that have not yet occurred. However, the Funds expect the risk of loss to be remote.

 

Note 8 – Fair Value Measurements and Disclosure 

Fair Value Measurements and Disclosures defines fair value, establishes a framework for measuring fair value in accordance with GAAP, and expands disclosure about fair value measurements. It also provides guidance on determining when there has been a significant decrease in the volume and level of activity for an asset or a liability, when a transaction is not orderly, and how that information must be incorporated into a fair value measurement.

 

Under Fair Value Measurements and Disclosures, various inputs are used in determining the value of the Funds’ investments. These inputs are summarized into three broad Levels as described below:

 

· Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities that the Funds have the ability to access.

 

· Level 2 – Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data.

 

· Level 3 – Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Funds’ own assumptions about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available.

56

 

AXS Funds

NOTES TO FINANCIAL STATEMENTS - Continued

September 30, 2023 (Unaudited)

 

 

The availability of observable inputs can vary from security to security and is affected by a wide variety of factors, including, for example, the type of security, whether the security is new and not yet established in the marketplace, the liquidity of markets, and other characteristics particular to the security. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3.

 

The inputs used to measure fair value may fall into different Levels of the fair value hierarchy. In such cases, for disclosure purposes, the Level in the fair value hierarchy within which the fair value measurement falls in its entirety, is determined based on the lowest Level input that is significant to the fair value measurement in its entirety.

 

The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities. The following is a summary of the inputs used, as of September 30, 2023, in valuing the Funds’ assets carried at fair value:

 

Astoria Inflation Sensitive ETF   Level 1     Level 2**     Level 3**     Total  
Investments                                
Common Stock*   $ 44,394,892     $ -     $ -     $ 44,394,892  
Exchange-Traded Funds*     12,931,885       -       -       12,931,885  
Total Investments   $ 57,326,777     $ -     $ -     $ 57,326,777  

 

Change Finance ESG ETF   Level 1     Level 2**     Level 3**     Total  
Investments                                
Common Stock*   $ 118,206,694     $ -     $ -     $ 118,206,694  
Total Investments   $ 118,206,694     $ -     $ -     $ 118,206,694  

 

First Priority CLO Bond ETF   Level 1***     Level 2     Level 3***     Total  
Investments