ANNUAL
report 2022
Motley
Fool Asset Management ETFs
Series of The RBB Fund, Inc.
8/31/22
Motley Fool Global Opportunities ETF (Formerly MFAM Global Opportunities Fund) |
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Motley Fool Mid-Cap Growth ETF (Formerly MFAM Mid-Cap Growth Fund) |
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Motley Fool 100 Index ETF |
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Motley Fool Small-Cap Growth ETF (Formerly MFAM Small-Cap Growth ETF) |
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Motley Fool Capital Efficiency 100 Index ETF |
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Motley Fool Next Index ETF |
Motley Fool Global Opportunities ETF (TMFG) |
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Motley Fool Mid-Cap Growth ETF (TMFM) |
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Motley Fool 100 Index ETF (TMFC) |
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Motley Fool Small-Cap Growth ETF (TMFS) |
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Motley Fool Capital Efficiency 100 Index ETF (TMFE) |
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Motley Fool Next Index ETF (TMFX) |
Table of Contents |
President’s Letter to Shareholders |
1 |
Letter to Shareholders |
3 |
Portfolio Characteristics |
11 |
Fund Expense Examples |
24 |
Schedules of Investments |
26 |
Financial Statements |
57 |
Notes to Financial Statements |
75 |
Report of Independent Registered Public Accounting Firm |
91 |
Shareholder Tax Information |
93 |
Notice to Shareholders |
94 |
Privacy Notice |
97 |
Directors and Officers |
100 |
Motley Fool Asset Management ETFS
President’s Letter to Shareholders
AUGUST 31, 2022 (Unaudited)
Kelsey
Mowrey
President,
Motley Fool Asset Management
Dear Fellow Shareholders,
First, I want to extend a heartfelt thank you for being members of our Foolish Family. We realize you have many investment options and appreciate the trust you place in us. We consider ourselves very fortunate to be on this journey with you.
And what a journey the last 12 months have been! Have you ever had the opportunity to ride Mr. Toad’s Wild Ride in Disneyland or Walt Disney World? When I sat down to write this letter and reflect on the past year, that beloved theme park ride kept coming to mind.
Maybe you can recall the magical, whimsical, sometimes perilous, and often buggy ride through Toad Hall and the English countryside. Mr. Toad’s Wild Ride was an original attraction when both Disneyland and Walt Disney World opened. While the Disney World iteration closed in 1998, the ride at Disneyland has had several reimaginations over the years, and still operates today.
As the Disney Universe keeps expanding, Mr. Toad’s Wild Ride provides a happy sense of nostalgia for many visitors, a reminder of the original magic that made Disney so special. This year, we also got a bit nostalgic and made the decision to bring Foolishness back to our brand in a big way. We moved away from our acronym, MFAM, and reintroduced our proper name, Motley Fool Asset Management. In addition, we are once again proudly wearing and displaying our jester cap in our company logo.
But Mr. Toad has evolved since 1955 as well (the original ride had plywood cutout characters!) Technical updates in 1961 and 1983 have transformed Mr. Toad’s Wild Ride into the beloved attraction we know today. At Motley Fool Asset Management, we had a transformation of our own last year. We converted two mutual funds to ETFs (a somewhat bumpy transition, to be honest!) and launched two new passive ETF products. With these ETF products we were able to improve efficiency, lower fees, increase transparency, and gain more access to our sister company, The Motley Fool, LLC’s stock recommendations.
That brings me to perhaps the most obvious parallel between Mr. Toad and the stock market: The Wild Ride. The past year, particularly the last 8 months, has been a challenging time to be an investor to say the least. Domestic stock market indexes logged numerous record highs during the latter half of 2021, only to come tumbling down in 2022. The S&P 500 Index closed at an all-time high on January 3, 2022, and then dropped 19.96% by June 30, 2022. As of August 31, 2022, it is down 16.14% year to date. Similar scenarios played out in the Dow Jones Industrial Average as well as the Nasdaq Composite and the domestic bond markets have not been the usual safe havens we have come to expect. A wild ride, indeed!
Throughout their trip with Mr. Toad, travelers encounter several obstacles or dangers. Whether you are trying to avoid a stack of falling books, plunging into a stream, or a collision with a delivery truck, there’s a lot that threatens to knock you off course. These last twelve months have had their share of obstacles too. Historically high inflation, continued supply chain issues and slowing domestic growth are just a few of the issues impeding our investment path.
Even though our time with Mr. Toad consists of many twists, turns, and startling moments, most park goers wouldn’t consider jumping out of the buggy mid-ride. That’s because they know if they wait long enough, the trek will end with a satisfying resolution. Investing shouldn’t be much different. With patience and a long time horizon, we believe short term market fluctuations most likely will not prevent us from reaching our long-term goals.
With that in mind, I’d like to thank you for staying on this ride with us. As investors, we know it is always important to stay the course; however, when the ride gets wild it can be difficult to maintain that mindset. Please know that we will continue to navigate this track along with you and be good stewards for your investments. We are grateful for your business and look forward to more adventures with you in the coming year, whatever the road ahead may bring.
Kindly,
Kelsey Mowrey
President
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Motley Fool Asset Management ETFS
President’s Letter to Shareholders (Concluded)
AUGUST 31, 2022 (Unaudited)
Motley Fool Asset Management’s ETFs are distributed by Quasar Distributors, LLC.
The investment advisor for each fund is Motley Fool Asset Management, LLC (“MFAM”). MFAM is a wholly owned subsidiary of Motley Fool Investment Management, LLC, whose parent company, The Motley Fool Holdings, Inc., is a multimedia financial-services holding company. MFAM, an affiliate of The Motley Fool LLC (“TMF”), is a separate legal entity. No TMF analyst is involved in the investment decision-making or daily operations of MFAM. With respect to its actively-managed funds, MFAM does not attempt to track any TMF services and, as such, those funds may diverge completely from TMF’s services.
The information contained herein does not take into account the particular investment objectives or financial circumstances of any specific person who may receive it.
All investing involves risk. Principal loss is possible. Each of Motley Fool Asset Management ETFs invests in particular market capitalizations or qualifications distinct to that individual fund, including small cap stocks and mid cap stocks, thus each fund’s performance will be especially sensitive to market conditions that particularly affect that fund’s particular market. Some funds are non-diversified, which means its NAV, market price and total returns may fluctuate or fall more than a diversified fund. Gains or losses on a single stock may have a greater impact on any of Motley Fool Asset Management’s ETFs. For these and other reasons, there is no guarantee any of Motley Fool Asset Management ETFs will achieve its particular, stated objective.
Please consider the charges, risks, expenses, and investment objectives carefully before you invest. Please see the prospectuses for the Motley Fool Global Opportunities ETF, the Motley Fool Mid-Cap Growth ETF, the Motley Fool 100 Index ETF, the Motley Fool Small-Cap Growth ETF, the Motley Fool Next Index ETF and the Motley Fool Capital Efficiency 100 Index ETF containing this and other information. Read it carefully before you invest or send money.
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Motley Fool Asset Management ETFS
Letter to Shareholders
AUGUST 31, 2022 (Unaudited)
Bryan
Hinmon
Chief Investment Officer,
Motley Fool Asset Management
“It is imperative that we remain vigilant in questioning how we do things that lead to decisions about investing your capital. We are on a quest to do this better, every day.”
— Me, back in 2016
Dear Fellow Shareholder,
You’re probably thinking: I can’t believe the ego of this guy, quoting himself to open this letter! Let me reassure you that my ego is kept well in check by my two year old. Most recently, he has admired the “stripes” across my forehead and around my eyes, mocked my “silly” attempt to build his train tracks, and laughed uncontrollably as my mini breakfast burritos “look like trash cans.” Writing this reminds me those barbs still sting and my ego has no chance of inflating.
In preparing to write this letter I went back and read what I’ve written in the past. I’ve touched on several important topics over the years: the folly of economic and market forecasting, bias and decision making, and simplicity and focus, to name a few. But the idea that tends to come up again and again, as highlighted in the opening quote, is the need to be open to change on a never-ending quest for better.
I think the reason this is the most popular idea to explore is because of the nature of investing. Investing resembles a wicked problem.1 That is, the problem isn’t fully understood, the context and constraints are always changing, and there is no obvious single answer that a rote process can solve for.
Given the messy nature of the endeavor, blindly applying thinking and methods that have worked in the past can be dangerous. Reflection, which addresses an honest capacity to accept underperformance and intelligently adapt, is critical for making sure we remain on the path to long term success. I believe that is the path we are on. We reflect on and consider improving our methods every year, but the state of affairs here in late 2022 make the exercise seem more poignant.
CAPACITY TO SUFFER
It is well known that investors feel losses more powerfully than gains. The urge to sell or to shift investing styles or methods, when things aren’t going well, is rooted in pain relief. Even if an investor is wired to handle some pain, as their stocks head relentlessly lower, the emotional hits keep coming. Research shows that, under such stress, investor focus narrows to the immediate future and, according to Michael Mauboussin, “turn[s] off any thought about the long term. So even if an investor believes a stock or industry group is likely to fare well over a three to six year period, anxiety about the next three to six months prevails – and a great opportunity slips away.”2
This narrowing of time frame has, in our view, come to life today via the broad selling of companies with the promise of strong cash flow generation in the future, but little current profitability. In investing shorthand, there has been a strong preference for value stocks over growth stocks. Value stocks, with their perceived tendency for tangible, bird-in-the-hand cash generation, have outperformed growth stocks by more than 35 percentage points over the past two years.3
This performance gap is breathtaking. Within the context of persistent inflation, rising global recession risk, changing monetary policy, and ongoing war during that two year period, a recalibration of the value of future cash flows seems warranted in our opinion. But the breadth and violence of the growth exodus suggests to us a degree of “stress” selling4 and raises the chance of some perfectly viable, high-value-creating (but not-yet-cash-flowing) businesses being tossed aside with the pretenders.
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The idea of Wicked Problems was developed by Horst Rittel and Melvin Webber in the early 1970s. Their definition was focused on social policy issues, but over the subsequent 50 years, the idea of wicked problems has been more loosely defined and broadly applied. The fact that investing is wicked is one of the aspects that make it so challenging, but also so fun. |
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Mauboussin, Michael. Anatomy of a Market Crash. Forbes, October 25, 2007. |
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Value stocks, here, are represented by the Russell 1000 Value Index. Growth stocks, here, are represented by the Russell 1000 Growth Index. Return data from Standard & Poor’s Capital IQ for the period 9/1/2020 to 8/31/2022. |
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We would recommend exploring the concept of “hyperbolic discounting” if you’re curious. |
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Motley Fool Asset Management ETFS
Letter to Shareholders (Continued)
AUGUST 31, 2022 (Unaudited)
We can’t in good faith, and simply won’t, state that many high-flyers are pretenders while ours are clear-cut, long-term winners that the market is mistreating. We have inked plenty of mistakes in the past and time will show us to have made additional ones. Said differently, it is unclear whether the market is treating our chosen growthy businesses rationally or whether it is panicking to some degree. But what we can say with confidence is that we understand our own beliefs and expectations behind each investment (thanks to our research process) and accept such pricing swings in exchange for the reward potential we believe persists.
We are, and remain, patient owners of businesses. While we don’t like poor performance, we appreciate that it is what sometimes creates mispricings and may open the door to long-term rewards.
ADAPTATION
You probably didn’t ignore the statement above about our past and inevitable future mistakes. We understand that no flavor of investing works 100% of the time, and that no active manager can operate in a mistake free utopia. The recent past has been trying, and we are frustrated with our performance. It is critical we dispassionately assess the situation and learn the right lessons.
Most importantly, we wholeheartedly believe that our core investing principle and core investing belief remain on firm foundations. Let’s lay these out plainly. The core principle that underpins our investing program is that, in the long run, we believe portfolio returns will converge on the business returns our companies achieve, as determined by realized earnings power (cash flows). The core belief that emerges from that principle, in our practice, is that independent research (centered on our unique definition of Quality) with a long-term mindset, expressed through focused portfolios, can potentially outperform and is how our team is best wired to achieve outperformance.
We’ve stress tested these ideas and have happily and completely re-underwritten them.
With our philosophy checked, we can move to execution. The largest class of mistake we made over the fiscal year, in my view, was in execution. Specifically, it was the improper weighting of base rates and the attendant link to position sizing. Let’s take a moment to make that not sound like gobbledygook.
We study businesses deeply, in an attempt to assess each company’s management, culture, and incentives; its economics, competitive advantages, and trajectory. Understanding a business in this fashion helps inform a view of the value it might be able to create for the world and how much of that value it might capture for itself, in a future that will undoubtedly be filled with competitors, changing preferences, and other uncertainties. It’s a complicated exercise where experience, imagination, humility, and skepticism are all needed. In the end, we’ve crafted a researched story behind each investment, called an inside view.
A problem arises when, as our knowledge of a business grows, our confidence in a single (but highly uncertain!) future grows even more quickly. Because of a highly informed inside view of each specific investment, our calibration of the reference class (the base rate statistical average, or the outside view of what has actually shown to most likely happen in similar situations) may be crowded out.5
Investing decisions are best made with a balanced account of the inside and outside views. However, the nature of our endeavor, to strive to find truly special Quality companies that can and do defy base rates, means that we must invest counter to what action the outside view suggests, and do it regularly. We knowingly override it.
The error is not in investing counter to what the outside view might recommend, but in not adequately using a tool we have available to marry the two views: position sizing. Knowing the outside view, of both the reference class of the stock and the business, should help us better assess the odds our inside view is correct, which should help establish guardrails for the amount of capital we put at risk in a given stock or class of risk exposures.
This is an exercise we can, will, and must do better. The outside view is something that has already entered our conversations more and more – like a voice over our shoulder. Practical implementations we are exploring further are making the outside view explicit in a premortem6 or establishing the role of a decision observer.7 Refinement of our process is ongoing and we’re energized when we uncover helpful possible solutions.
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For a deeper dive into the Inside/Outside view problem, we highly recommend Thinking Fast and Slow by Daniel Khaneman and Think Twice by Michael Mauboussin. |
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Professor Gary Klein has been the leading thinker on premortems. We are grateful for his continued work on the subject. |
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The role of a “decision observer” was introduced to us in the book Noise, by Daniel Kahneman, Olivier Sibony, and Cass Sunstein. On page 240 they write, “We suggest that observers can be trained to spot, in real time, the diagnostic signs that one or several familiar biases are affecting someone else’s decisions or recommendations.” |
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Motley Fool Asset Management ETFS
Letter to Shareholders (Continued)
AUGUST 31, 2022 (Unaudited)
MARKET PERFORMANCE AND COMMENTARY
Coming into calendar year 2022, the U.S. economy was strong and inflation was accelerating. Some level of inflation was expected as the result of shifting consumption patterns influenced by the flow-through of pandemic imbalances. The prevailing debate was whether this would fix itself (this was the U.S. Federal Reserve’s (the “Fed”) thinking) or be persistent. The purity of that debate was muddied as early 2022 brought about the Russian invasion of Ukraine and China’s continued aggressive lockdown policy to manage the spread of COVID – both events mucking up global supply chains and exacerbating the supply-demand imbalance that has been feeding inflation.
Over the full year fiscal period of September 1, 2021 to August 31, 2022, monthly U.S. inflation rates were between 5.4% and 9.1%. This, unsurprisingly, contributed to the Fed’s Open Market Committee decision to raise rates by 25 basis points, 50 basis points, 75 basis points, and another 75 basis points between March and July of this year. (Although outside the fiscal year ended August 31, 2022, we know the Fed raised another 75 basis points in September.) They were busy, and the aggressive pace of rate increases marked a clear new stance in monetary policy. This shift, alongside weakening European economic outlooks, had a negative impact on markets broadly as investors dealt with greater uncertainty, grappled with the likelihood of a global recession, and repriced risk.
The broad brush outcome was that, for the full year period of September 1, 2021 to August 31, 2022, there was almost no safe place to hide.
Cash lost value given the strongly rising inflation. Bonds had a historically poor period, falling more than 10% as interest rates moved higher. Gold, often seen as a safe-haven and beneficiary of inflation, lost more than 5%. Bellwether large capitalization stocks fell 12% with eight of 11 sectors declining. Small- and mid-capitalization stocks fell similarly to large caps. Simple style preferences offered no reprieve, with growth stocks continuing their recent trend of underperformance relative to value stocks (-17% vs -5%). Outside the U.S., global stocks fell 20%.8
ACTIVE ETF PERFORMANCE AND COMMENTARY
Motley Fool Global Opportunities ETF
With that sour backdrop, the Motley Fool Global Opportunities ETF returned -27.61% during the fiscal year ended August 31, 2022, trailing its benchmark’s return of -15.98% for the same period. Cumulatively since inception, the Motley Fool Global Opportunities ETF has returned 91.55% versus 70.94% returns for the benchmark over the same period.9
During the period, the ETF’s investments’ tilt towards growth companies, a lack of exposure to the Energy sector, and security selection within the Information Technology sector drove its underperformance. These headwinds were offset by strong security selection within the Industrials and Consumer Staples sectors. Our aim, as you know, is to construct focused portfolios of truly special Quality businesses (we have a “no strangers in the portfolio” mantra), so whether our performance is relatively good or bad, we can usually attribute the bulk of any relative performance versus the benchmark to stock selection. That was again the case this year.
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Bonds are represented by the S&P U.S. Aggregate Bond Index. The index is designed to measure the performance of publicly issued U.S. dollar denominated investment-grade debt. Gold is represented by the COMEX price per troy ounce of gold. Large capitalization stocks are represented by the S&P 500 TR Index. The index measures the total return performance of 500 leading companies comprising nearly 80% of available U.S. market capitalization. Small capitalization stocks are represented by the S&P SmallCap 600 TR Index. The index measures the total return performance of 600 small-sized U.S. companies that meet certain liquidity and financial thresholds. Mid-capitalization stocks are represented by the S&P MidCap 400 TR Index. The index measures the total return performance of 400 mid-sized U.S. companies comprising about 5% of available U.S. market capitalization. Growth stocks are represented by the S&P 500 Growth TR Index. The index measures the performance of a subset of S&P 500 stocks based on three factors: sales growth, the ratio of earnings change to price, and momentum. Value stocks are represented by the S&P 500 Value TR Index. The index measures the performance of a subset of S&P 500 stocks based on three factors: the ratios of book value, earnings, and sales to price. Global stocks are represented by the S&P Global X-US BMI TR Index. The index measures stock market performance globally, including developed and emerging markets, but excluding the U.S. |
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Returns are for Net Asset Value, net of fees and expenses. Inception of the ETF was 6/17/2014, which represents the inception of the Advisor share class of the pre-conversion mutual fund. The benchmark of the Motley Fool Global Opportunities ETF is the FTSE Global All Cap Net Tax Index. |
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Motley Fool Asset Management ETFS
Letter to Shareholders (Continued)
AUGUST 31, 2022 (Unaudited)
The top three contributors to returns10 were Gentera (+45%), Waste Connections (+8%), and Costco (+15%). Gentera has historically been a unique, group lender in several Latin American countries. Management has deftly handled pandemic and general macroeconomic challenges, achieving admiral loan and customer growth in Mexico and Peru while keeping costs in check. Shares soared as the company won back investor confidence, though we chose to sell our position towards the end of the period as the company’s business model is changing via its entry into a more crowded lending arena. Waste Connections is a North American trash hauler with irreplaceable landfill assets and an admirable service record. Trash collection is a safe-haven type of business that often does well in uncertain times – demand for its services doesn’t change much regardless of world events and proven pricing power above the rate of inflation are key business model features that investors are looking for. Costco, the membership retail behemoth, continues to use its scale to bring more products and services to its loyal customer base. The value proposition, in terms of savings and purchase confidence, has never been stronger, in our view, and the model continues to translate outside the core U.S. market.
The bottom three contributors to returns were Paypal Holdings(-68%), MercadoLibre (-54%), and Everbridge (-75%). Paypal remains an entrenched player in online payments, but it has seen its primary end market (ecommerce) slow as pandemic demand pull-forward is digested. A lack of internal innovation has also contributed to slowing new user growth, and several high profile leaders have left the company. Payments remains a hyper-competitive and dynamic industry, but Paypal’s scale and newfound sense of urgency equip it well to thrive once again. MercadoLibre, the everything business in Latin America, continues to strengthen its network effects across commerce and payments. The only significant business blip we have seen is a spike in non-payments of installment loans at peer companies (many e-commerce transactions are paid by installment in Latin America). The more likely drivers of the stock’s decline, in our view, are the simple market-wide declines in highly-valued tech companies that were clear pandemic beneficiaries. Everbridge’s decline has been swift. In early December, during a widespread sell-off of many software businesses, the company announced the unexpected resignation of its CEO and preliminary 2022 guidance that was lower than expected. This was a powerfully poisonous cocktail and shares fell by nearly half in a single day. As the dust has settled, it appears that the former CEO was too aggressive pursuing growth via acquisitions and product launches, at the expense of product integration and a clear product map. Under new leadership, and with greater focus, we believe these issues are fixable.
Motley Fool Mid-Cap Growth ETF
The Motley Fool Mid-Cap Growth ETF returned -26.66% during the fiscal year ended August 31, 2022, edging its benchmark’s return of -26.69% for the same period. Cumulatively since inception (8 years and counting!), the Motley Fool Mid-Cap Growth ETF has returned 79.75% versus 111.00% returns for its benchmark over the same period.11
The ETF’s performance, relative to its benchmark, was impacted by a lack of exposure to the energy sector, which was strong and where we had no investment. Performance was also driven by our investments in the Consumer Discretionary and Financials sectors, where our stock selection was strong, and offset by stock selection in the Information Technology and Healthcare sectors.
The top three contributors to returns were Brown & Brown (+9%), Healthequity (+3%), and Broadridge Financial Solutions (+1%). Brown & Brown is an insurance broker that has been churning out great results – quarterly results have been consistently outstanding. Insurance, itself, is a cyclical market and Brown is benefiting from strong pricing that won’t last forever. However, its ability to grow policy count, make smart acquisitions, and manage costs have helped its business perform well through up and down cycles. HealthEquity, the largest administrator of Health Savings Accounts, is a beneficiary of the rising interest rate and inflation environment. Account holders opt to invest their savings in funds or cash, and as rates rise, the interest earned on that cash rises too. As an administrator, HealthEquity earns more on better rates and higher balances. Inflation is also likely to drive healthcare costs higher, in general, and should continue to highlight the value of Health Savings Accounts and benefit HealthEquity with greater adoption and contributions. Broadridge had a business-as-usual year. Its business model benefits from facilitating investor communications required by law which provides steady demand it has been able to turn into stable cash flow. This stability and proven profit engine are highly prized by investors given all the uncertainties elsewhere, and shares of the company’s stock have held up recently.
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Contribution to return is a combination of average weighting in the portfolio and total return during the period. |
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Returns are for Net Asset Value, net of fees and expenses. Inception of the ETF was 6/17/2014, which represents the inception of the Advisor share class of the pre-conversion mutual fund. The benchmark of the Motley Fool Mid-Cap Growth ETF is the Russell Midcap Growth Total Return Index. |
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Motley Fool Asset Management ETFS
Letter to Shareholders (Continued)
AUGUST 31, 2022 (Unaudited)
The bottom three contributors to returns were Axon Enterprise (-36%), Teladoc Health (-77%), and Everbridge (-75%). Axon Enterprise, the business, continues to hum along. Its safety, transparency, and efficiency-focused products are resonating with law enforcement far and wide. However, the company’s CFO unexpectedly took another job and several members of its ethics board resigned in the wake of the company pushing forward its Taser-equipped drone initiative. The CFO departure is a clear loss for the company, but one which we believe will be overcome. The ethics board drama bears watching. Axon is a mission-driven company and its Founder/CEO’s ambition is great – but we have admired the checks and balances of impartial counsel and dislike the apparent lack of teeth it has been given. Telemedicine provider Teladoc continues to struggle to achieve profitability even as the pandemic created a strong adoption and utilization tailwind for its business. In addition, in the second calendar quarter of 2022, management wrote down over $6 billion of goodwill from its 2020 merger with Livongo Health. In hindsight, the merger was an obviously atrocious capital allocation decision, and combined with continued uneven execution, we have lost faith in management and sold our position. We detailed Everbridge’s poor performance above, in the Motley Fool Global Opportunities ETF section.
Motley Fool Small-Cap Growth ETF
The Motley Fool Small-Cap Growth ETF returned -36.66% during the fiscal year ended August 31, 2022, exceeding its benchmark’s decline of -25.26% for the same period. Cumulatively since inception, the Motley Fool Small-Cap Growth ETF has returned 38.08% versus 27.87% returns for the benchmark over the same period.12
The ETF’s performance, relative to its benchmark, was impacted negatively by an underweight of exposure to the Energy sector. However, the primary driver of underperformance was stock selection in the Industrials, Financials, and Information Technology sectors. The market environment was highly punitive to companies delaying profits to pursue growth and market development. Our holdings were not spared, with roughly one-third of the portfolio’s holdings declining in price by 50% or more.
The top three contributors to returns13 were Ping Identity Holding (+8%), Northern Oil and Gas (+15%), and PTC Therapeutics (+14%). Enterprise security software veteran Ping Identity had been working hard to transform its business to be a long-term winner in the critical enterprise security world. Private Equity firm Thoma Bravo apparently believed this too, and announced it would take Ping private at an enterprise value of $2.8 billion. The transaction had not yet closed at period end and Ping shares have continued to bop around the buyout price. We purchased shares of Northern Oil and Gas in May. Historically, we haven’t found many businesses in the Energy sector that meet our Quality threshold, but Northern’s unique business model and strong leadership fit the bill. The company buys up land leases and then lets other exploration and production companies drill on their land. As the land owner, Northern can choose to participate in the production cash flows or not. We believe the company’s controlling family has valuable insights and experience to make that decision wisely, more often than not. As energy prices increase, the value of Northern’s land rights and production options has increased. PTC Therapeutics is a biotechnology company that focuses on orphan diseases. More often than not, the performance of companies like PTC depends on whether there have been beneficial or adverse developments in the perceived medical and commercial progress of its drug pipeline. PTC had positive news on both fronts as its diversified portfolio of drugs and candidates continues to demonstrate value and efficacy.
The bottom three contributors to returns were Everbridge (-75%), Cardlytics (-85%), and Heska (-66%). We detailed Everbridge’s poor performance above, in the Motley Fool Global Opportunities ETF section. Cardlytics provides app-native digital advertising solutions to financial institutions. The business experienced a tumultuous year, punctuated by executive turnover, slow-moving customers, and a potentially competitive acquisition by a key customer. The stock’s decline reflects this, as well as the aggressive sell-off of profit promise stocks we outlined earlier. In our view, the new CEO brings the right experience for Cardlytics’ future, development of its self-serve ad platform has gone well, and the likelihood of customer defection remains low. In short, we think the market is getting this one wrong. Heska provides diagnostic tools and tests to veterinarians. Investors had bid up shares reflecting what we believe to be the company’s strong execution strengthening its domestic business and vision in becoming a market leader in several non-U.S. markets. Investors fear that a pandemic-related pet adoption boom may harm upcoming growth rates, which we view as a likely short-term blip in a longer-term attractive opportunity.
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Returns are for Net Asset Value, net of fees and expenses. Inception of the ETF was 10/29/2018, which represents the inception of the Advisor share class of the pre-conversion mutual fund. The benchmark is the Russell 2000 Growth Total Return Index. |
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Contribution to return is a combination of average weighting in the portfolio and total return during the period. |
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Motley Fool Asset Management ETFS
Letter to Shareholders (Continued)
AUGUST 31, 2022 (Unaudited)
PASSIVE ETF PERFORMANCE AND COMMENTARY
Motley Fool 100 Index ETF
The Motley Fool 100 Index ETF declined -19.18% during the fiscal year ended August 31, 2022. During the same period, the Motley Fool 100 Index, which the Motley Fool 100 Index ETF is designed to track, declined -18.79% and the S&P 500 Total Return Index declined -11.23%. Cumulatively since inception, the Motley Fool 100 Index ETF returned 73.03%. Over that period, the Motley Fool 100 Index returned 77.03% and the S&P 500 Index returned 50.38%.14
The ETF’s net asset value return differed from that of its underlying index, the Motley Fool 100 Index, due primarily to the deduction of management fees and transaction costs. A small cash balance across the period and securities lending income helped reduce tracking error.
As a passive implementation of active stock selection, the ETF’s performance in each period is reflective of the construction of its underlying index, the Motley Fool 100 Index, which is a market capitalization weighted portfolio of the 100 largest, liquid, high-conviction stock selections from The Motley Fool, LLC.15 The Motley Fool 100 Index has historically had, and continues through this measurement period to have, a top-heavy construction and concentration in a subset of sectors. As a result, the largest holdings and sector exposures have a significant impact on overall performance.
The top three contributors16 to the Motley Fool 100 Index ETF’s performance were UnitedHealth Group (+26%), Apple (+5%) and Costco (+15%). These three companies had a combined average portfolio weight during the period of more than 16%. The bottom three contributors were Meta Platforms (-57%), Alphabet (-25%), and Amazon (-27%). These three companies had a combined average portfolio weight during the period of nearly 20%.
Over the period from September 1, 2021 to August 31, 2022, a drastic underweighting to the Energy sector and overweighting to the Communication Services sector drove underperformance versus the S&P 500 Index.
Motley Fool Next Index ETF
On December 30, 2021, we launched The Motley Fool Next Index ETF. Over the period from December 30, 2021 to August 31, 2022, the ETF declined -24.88%. During the same period, the Motley Fool Next Index, which the Motley Fool Next Index ETF is designed to track, declined -24.72% and the Russell Midcap Growth Total Return Index (the “benchmark”) declined -25.42%.17
The ETF’s net asset value return differed from that of its underlying index, the Motley Fool Next Index, due primarily to the deduction of management fees and transaction costs. A small cash balance across the period helped reduce tracking error.
As a passive implementation of active stock selection, the ETF’s performance in each period is reflective of the construction of its underlying index, the Motley Fool Next Index, which is a market capitalization weighted index of the mid- and small-capitalization U.S. companies that have been recommended by The Motley Fool, LLC’s analysts, or research publications.18
The top three contributors to the Motley Fool Next Index ETF’s performance were McKesson (+31%), EPAM Systems (+44%) and Cloudflare (+43%). These three companies had a combined average portfolio weight during the period of a bit more than 3%. The bottom three contributors were The Trade Desk (-33%), Zebra Technologies (-50%), and Wayfair (-73%). These three companies had a combined average portfolio weight during the period of 3%.
14 |
Returns are for Net Asset Value, net of fees and expenses. The market price return for the Motley Fool 100 Index ETF for the year ended 8/31/2022 was -19.24%, and since inception, was 12.70%. Inception of the Motley Fool 100 Index ETF was 1/29/2018. |
15 |
Motley Fool Asset Management LLC is a subsidiary of The Motley Fool. The Motley Fool is responsible for independently managing the Motley Fool 100 Index. To learn more about the index, see its website: https://www.fool100.com/ |
16 |
Contribution to return is a combination of average weighting in the portfolio and total return during the period. |
17 |
Returns are for Net Asset Value, net of fees and expenses. The market price return for the Motley Fool Next Index ETF for the period from 12/30/2021 to 8/31/2022 was -24.97%. |
18 |
Motley Fool Asset Management LLC is a subsidiary of The Motley Fool. The Motley Fool is responsible for independently managing the Motley Fool 100 Index. To learn more about the index, see its website: https://www.fool100.com/ |
8 |
Motley Fool Asset Management ETFS
Letter to Shareholders (Continued)
AUGUST 31, 2022 (Unaudited)
The Motley Fool Next Index was significantly underweight in the Energy sector and overweight in the Communication Services sector, relative to the benchmark. During the year ended August 31, 2022, the ETF reflected these relative positions, and performance suffered accordingly. Stock selection was strongest in the Healthcare sector to which the Motley Fool Next Index and ETF maintained a modest underweight to the benchmark.
Motley Fool Capital Efficiency 100 Index ETF
On December 30, 2021, we launched The Motley Fool Capital Efficiency 100 Index ETF. Over the period from December 30, 2021 to August 31, 2022, the ETF declined -23.13%. During the same period, the Motley Fool Capital Efficiency 100 Index, which the Motley Fool Capital Efficiency 100 Index ETF is designed to track, declined -23.07% and the S&P 500 Total Return Index (the “benchmark”) declined -16.36%.19
The ETF’s net asset value return differed from that of its underlying index, the Motley Fool Capital Efficiency 100 Index, due primarily to the deduction of management fees and transaction costs. A small cash balance across the period helped reduce tracking error.
As a passive implementation of active stock selection, the ETF’s performance in each period is reflective of the construction of its underlying index, the Motley Fool Capital Efficiency 100 Index, which tracks the performance of the highest scoring stocks of U.S. companies, measured by a company’s capital efficiency, that have been recommended The Motley Fool’s analysts and newsletters.20 Capital efficiency is a measure of how a business turns its investments into revenue and profit, and it provides insight into the company’s return on invested capital.
The top three contributors21 to the Motley Fool Capital Efficiency Index ETF’s performance were UnitedHealth Group (+4%), Texas Instruments (+8%) and Vertex Pharmaceuticals (+27%). These three companies had a combined average portfolio weight during the period of nearly 7%. The bottom three contributors were Meta Platforms (-53%), NVIDIA (-49%), and Alphabet (-25%). These three companies had a combined average portfolio weight during the period of just over 14%.
The Motley Fool Capital Efficiency 100 Index was significantly underweight in the Energy sector and overweight in the Communication Services and Information Technology sectors, relative to the benchmark during the period ended August 31, 2022. In fact, the Index and ETF had no Energy sector exposure and nearly 55% to Communication Services and IT, compared to 4% and 37%, respectively, for the benchmark.
MORE IMPORTANT THAN EVER
We know that in challenging, stressful times the timeframe of the typical market participant shrinks. We posit that there is a degree of pessimism-extrapolation present in equity markets today. This puts us squarely in a place where maintaining a long-term orientation is increasingly valuable to achieve long-term returns.
Thankfully, our investing philosophy guides us to do just that. Our focus remains on patiently owning a collection of special, Quality businesses that will create winning outcomes for their stakeholders over time. We hope this orientation still rings true to you.
We remain thankful for and humbled by your trust.
Onward,
Bryan
Hinmon
Chief Investment Officer, Motley Fool Asset Management LLC
19 |
Returns are for Net Asset Value, net of fees and expenses. The market price return for the Motley Fool Capital Efficiency 100 Index ETF for the period 12/30/2021 to 8/31/2022 was -23.09%. |
20 |
Motley Fool Asset Management LLC is a subsidiary of The Motley Fool. The Motley Fool is responsible for independently managing the Motley Fool 100 Index. To learn more about the index, see its website: https://www.fool100.com/ |
21 |
Contribution to return is a combination of average weighting in the portfolio and total return during the period. |
9 |
Motley Fool Asset Management ETFS
Letter to Shareholders (Concluded)
AUGUST 31, 2022 (Unaudited)
Past performance does not guarantee future results. There can be no guarantee that any strategy (risk management or otherwise) will be successful. All investing involves risk, including potential loss of principal. Securities in a Fund may not match those in an index and performance of the Fund will be different. You cannot invest directly into an index.
The Letter to Shareholders seeks to describe some of the Adviser’s current opinions and views of the financial markets. Although the Adviser believes it has a reasonable basis for any opinions or views expressed, actual results may differ, sometimes significantly so, from those expected or expressed. The securities held by the Funds that are discussed in the Letter to Shareholders were held during the period covered by the annual report. They do not comprise the entire investment portfolio of the Funds, may be sold at any time, and may no longer be held by the Funds. The opinions of the Adviser with respect to those securities may change at any time.
10 |
Motley Fool GLOBAL OPPORTUNITIES ETF
Portfolio Characteristics
(Unaudited)
Average Annual Total Returns for the periods ended AUGUST 31, 2022 | ||||
One
|
FIVE |
Since
|
Inception
| |
Motley Fool Global Opportunities ETF* |
-27.61% |
8.87% |
8.24% |
6/17/2014 |
FTSE Global All Cap Net Tax Index** |
-15.98% |
7.06% |
6.75%(1) |
— |
Fund Expense Ratio:(2) 0.85% |
Effective December 3, 2021, the outstanding Investor Class Shares of the Fund were converted into Institutional Class Shares of the Fund.
The performance data quoted represents past performance and does not guarantee future results. Current performance may be lower or higher. Performance data current to the most recent month-end may be obtained at www.fooletfs.com. The investment return and principal value of an investment will fluctuate so that shares, when redeemed, may be worth more or less than their original cost.
(1) |
Benchmark performance is from inception date of the Fund only and is not the inception date of the benchmark itself. |
(2) |
The expense ratios of the Fund are set forth according to the Prospectus for the Fund and may differ from the expense ratios disclosed in the Financial Highlights tables in this report. See the Financial Highlights for more current expense ratios. |
* |
The Motley Fool Global Opportunities ETF operated as a series of The Motley Fool Funds Trust (the “Predecessor Fund”) prior to December 21, 2016 at which time the Predecessor Fund was reorganized into the Fund. The performance shown for periods prior to December 21, 2016 represents the performance of the Predecessor Fund. These returns reflect expense waivers by the Fund’s investment adviser. Without these waivers, returns would have been lower. |
** |
The FTSE Global All Cap Net Tax Index is a market-capitalization weighted index representing the performance of large, mid and small cap companies in Developed and Emerging markets. The index is comprised of approximately 9,500 securities from 49 countries and captures 98% of the world’s investable market capitalization. Fair value prices and foreign exchange as of 4 pm ET are used in the calculation of this index, and returns are adjusted for withholding taxes applicable to dividends received by a U.S. Regulated Investment Company domiciled in the United States. The index is unmanaged and not available for direct investments. Its performance does not reflect deductions for fees, expenses or taxes. |
11 |
Motley Fool GLOBAL OPPORTUNITIES ETF
Portfolio Characteristics (CONTINUED)
(Unaudited)
The investment objective of the Motley Fool Global Opportunities ETF is to achieve long-term capital appreciation, and it pursues this objective by investing primarily in common stocks of companies located anywhere in the world. The Fund seeks long-term growth by identifying and acquiring securities of companies that are, in the view of Motley Fool Asset Management, LLC (the “Adviser”), high quality. To identify these high-quality businesses, the Adviser engages in research to evaluate each company under consideration using four criteria: management, culture, and incentives; the economics of the business; competitive advantage; and trajectory. The Adviser’s approach prizes a long-term mindset and a balance of qualitative and quantitative factors.
The Fund will invest in areas of the market, that, in the view of the Adviser, offer the greatest potential for long-term capital appreciation, and it does not attempt to match the allocations of its benchmark. As such, significant deviation from the benchmark is expected from time to time, especially over shorter time frames.
The allocations to various sectors, countries, or any other macro-economic designation, are the byproduct of rigorous bottom-up analysis rather than an intentional top-down opinion of asset classes. While market conditions are constantly changing, exposure to equity market risk is needed to consistently achieve equity-like returns.
The following tables show the top ten holdings, sector allocations, and top ten countries in which the Fund was invested in as of August 31, 2022. Portfolio holdings are subject to change without notice.
Top Ten Holdings |
%
OF NET |
Amazon.com, Inc. |
5.9% |
Mastercard, Inc., Class A |
5.7 |
Watsco, Inc. |
5.0 |
Atlassian Corp., PLC, Class A |
4.7 |
Waste Connections, Inc. |
4.4 |
Alphabet, Inc., Class C |
4.0 |
Cellnex Telecom SA |
3.7 |
Axon Enterprise, Inc. |
3.6 |
ICON PLC |
3.4 |
International Container Terminal Services, Inc. |
3.2 |
43.6% |
12 |
Motley Fool GLOBAL OPPORTUNITIES ETF
Portfolio Characteristics (Concluded)
(Unaudited)
The Motley Fool Global Opportunities ETF uses the Global Industry Classification StandardSM (“GICS SM”) as the basis for the classification of securities on the Schedule of Investments (“SOI”).
Sector Allocation |
%
OF Net |
Industrials |
20.5% |
Information Technology |
19.7 |
Consumer Discretionary |
14.2 |
Financials |
12.7 |
Communication Services |
12.1 |
Real Estate |
8.6 |
Health Care |
7.5 |
Consumer Staples |
2.4 |
97.7% |
Top ten Countries |
%
OF Net |
United States* |
54.0% |
Canada |
9.2 |
Ireland |
6.0 |
Australia |
4.7 |
Spain |
3.7 |
Philippines |
3.2 |
China |
3.2 |
Taiwan |
3.1 |
United Kingdom |
2.8 |
India |
2.6 |
92.5% |
* |
As of the date of this report, the Fund had a holding of 2.1% in the U.S. Bank Money Market Deposit Account. |
13 |
Motley Fool MID-CAP GROWTH ETF
Portfolio Characteristics
(Unaudited)
Average Annual Total Returns for the periods ended AUGUST 31, 2022 | ||||
One
|
FIVE
|
Since
|
Inception
| |
Motley Fool Mid-Cap Growth ETF* |
-26.66% |
7.69% |
7.41% |
6/17/2014 |
Russell MidCap® Growth Total Return Index** |
-26.69% |
10.16% |
9.53%(1) |
— |
Fund Expense Ratio:(2) 0.85% |
Effective December 3, 2021, the outstanding Investor Class Shares of the Fund were converted into Institutional Class Shares of the Fund.
The performance data quoted represents past performance and does not guarantee future results. Current performance may be lower or higher. Performance data current to the most recent month-end may be obtained at www.fooletfs.com. The investment return and principal value of an investment will fluctuate so that shares, when redeemed, may be worth more or less than their original cost.
(1) |
Benchmark performance is from inception date of the Fund only and is not the inception date of the benchmark itself. |
(2) |
The expense ratios of the Fund are set forth according to the Prospectus for the Fund and may differ from the expense ratios disclosed in the Financial Highlights tables in this report. See the Financial Highlights for more current expense ratios. |
* |
The Motley Fool Mid-Cap Growth ETF operated as a series of The Motley Fool Funds Trust (the “Predecessor Fund”) prior to December 21, 2016 at which time the Predecessor Fund was reorganized into the Fund. The performance shown for periods prior to December 21, 2016 represents the performance of the Predecessor Fund. These returns reflect expense waivers by the Fund’s investment adviser. Without these waivers, returns would have been lower. |
** |
The Russell Midcap® Growth Total Return Index measures the performance of the mid-cap growth segment of the U.S. equity universe. It includes those Russell Midcap® Index companies with higher price-to-book ratios and higher forecasted growth values. The Russell Midcap® Growth Total Return Index is constructed to provide a comprehensive and unbiased barometer of the mid-cap growth market. The Index is completely reconstituted annually to ensure larger stocks do not distort the performance and characteristics of the true mid-cap growth market. |
The investment objective of the Motley Fool Mid-Cap Growth ETF is to achieve long-term capital appreciation, and it pursues this objective by investing primarily in common stocks of companies organized in the United States. The Fund seeks long-term growth by identifying and acquiring securities of companies that are, in the view of the Adviser, high quality. To identify these high-quality businesses, the Adviser engages in research to evaluate each company under consideration using four criteria: management, culture, and incentives; the economics of the business; competitive advantage; and trajectory. The Adviser’s approach prizes a long-term mindset and a balance of qualitative and quantitative factors.
14 |
Motley Fool MID-CAP GROWTH ETF
Portfolio Characteristics (Concluded)
(Unaudited)
The Fund will invest in areas of the market, that, in the view of the Adviser, offer the greatest potential for long-term capital appreciation, and it does not attempt to match the allocations of its benchmark. As such, significant deviation from the benchmark is expected from time to time, especially over shorter time frames.
The allocations to various sectors, or any other macro-economic designation, are the byproduct of rigorous bottom-up analysis rather than an intentional top-down opinion of asset classes. While market conditions are constantly changing, exposure to equity market risk is needed to consistently achieve equity-like returns. The Adviser views its time as best spent focused on evaluating businesses and seeking to minimize company-specific risk in order to pursue its objective of long-term capital appreciation.
Although the Motley Fool Mid-Cap Growth ETF may invest in companies with any market capitalization, the Adviser expects that investments in the securities of companies having smaller- and mid-market capitalizations will be important components of the Fund’s investment program. Investments in securities of these companies may involve greater risk than do investments in larger, more established companies. Small- and mid-cap stocks tend to be more volatile and less liquid than their large-cap counterparts.
The following tables show the top ten holdings, and sector allocations in which the Fund was invested in as of August 31, 2022.Portfolio holdings are subject to change without notice.
Top ten Holdings |
%
OF Net |
Watsco, Inc. |
7.5% |
SBA Communications Corp. |
6.2 |
Brown & Brown, Inc. |
5.3 |
Paylocity Holding Corp. |
5.0 |
ResMed, Inc. |
4.7 |
Markel Corp. |
4.5 |
Tyler Technologies, Inc. |
4.5 |
Axon Enterprise, Inc. |
4.5 |
Fastenal Co. |
4.1 |
Broadridge Financial Solutions, Inc. |
4.0 |
50.3% |
The Motley Fool Mid-Cap Growth ETF uses the Global Industry Classification StandardSM (“GICS SM”) as the basis for the classification of securities on the Schedule of Investments (“SOI”).
Sector Allocation |
%
OF Net |
Information Technology |
28.0% |
Industrials |
20.2 |
Financials |
13.5 |
Health Care |
11.7 |
Consumer Discretionary |
10.6 |
Real Estate |
9.8 |
93.8% |
15 |
Motley Fool 100 Index ETF
Portfolio Characteristics
(Unaudited)
AVERAGE ANNUAL TOTAL RETURNS FOR THE PERIODS ENDED AUGUST 31, 2022 | ||||
One |
THREE |
Since
|
Inception
| |
Motley Fool 100 Index ETF |
-19.18% |
15.26% |
12.70% |
1/29/2018 |
Motley Fool 100 Index* |
-18.79% |
15.85% |
13.26%(1) |
— |
S&P 500* Total Return Index** |
-11.23% |
12.39% |
9.30%(1) |
— |
Fund Expense Ratio:(2) 0.50% |
The performance data quoted represents past performance and does not guarantee future results. Current performance may be lower or higher. The investment return and principal value of an investment will fluctuate so that shares, when redeemed or sold, may be worth more or less than their original cost.
(1) |
Benchmark performance is from inception date of the Fund only and is not the inception date of the benchmark itself. |
(2) |
The expense ratio of the Fund is set forth according to the Prospectus for the Fund and may differ from the expense ratio disclosed in the Financial Highlights table in this report. See the Financial Highlights for most current expense ratio. |
* |
The Motley Fool 100 Index (“Fool 100 Index”) was developed by The Motley Fool, LLC (“The Motley Fool”), an affiliate of Motley Fool Asset Management, LLC (“Adviser”), in 2017 and is a proprietary, rules-based index designed to track the performance of the 100 largest, most liquid U.S. companies that have been recommended by The Motley Fool’s analysts and newsletters or the highest-rated stocks in Fool IQ, the company’s analyst opinion database. Every company included in the Fool 100 Index is incorporated and listed in the U.S. The Fool 100 Index is calculated and administered by Solactive AG (the “Index Calculation Agent”), which is not affiliated with the Fund, the Adviser or The Motley Fool. Additional information regarding the Fool 100 Index, including its value, is available on the websites of the Fund at www.fooletfs.com and the Index Calculation Agent, at www.solactive.com. You cannot invest directly in an index. |
** |
The S&P 500® Total Return Index is the total return version of the S&P 500® Index. Dividends are reinvested on a daily basis and all regular cash dividends are assumed reinvested in the index on the ex-dividend date. The S&P 500® Index is a market-capitalization-weighted index of 500 US stocks chosen for market size, liquidity and industry grouping, among other factors. The S&P 500® Index is designed to be a leading indicator of U.S. equities and is meant to reflect the risk/return characteristics of the large cap universe. The S&P 500® Index was first introduced on the 1st of January, 1923, though expanded to 500 stocks on March 4, 1957. |
16 |
Motley Fool 100 Index ETF
Portfolio Characteristics (Concluded)
(Unaudited)
The following tables show the top ten holdings and sector allocations, in which the Motley Fool 100 Index ETF was invested in as of August 31, 2022. Portfolio holdings are subject to change without notice.
Top TEN Holdings |
%
OF Net |
Apple, Inc. |
14.1% |
Microsoft Corp. |
10.8 |
Alphabet, Inc., Class C |
7.9 |
Amazon.com, Inc. |
7.1 |
Tesla, Inc. |
4.7 |
Berkshire Hathaway, Inc., Class B |
3.4 |
UnitedHealth Group, Inc. |
2.7 |
Meta Platforms, Inc., Class A |
2.4 |
Johnson & Johnson |
2.3 |
Visa, Inc., Class A |
2.3 |
57.7% |
The Motley Fool 100 Index ETF uses the Global Industry Classification StandardSM (“GICSSM”) as the basis for the classification of securities on the Schedule of Investments (“SOI”). We believe that this makes the SOI classifications more standard with the rest of the industry.
Sector Allocation |
%
OF Net |
Information Technology |
41.9% |
Consumer Discretionary |
17.1 |
Communication Services |
14.0 |
Health Care |
11.0 |
Financials |
8.0 |
Industrials |
3.0 |
Real Estate |
1.6 |
Consumer Staples |
1.5 |
Utilities |
0.9 |
Materials |
0.6 |
Energy |
0.2 |
99.8% |
17 |
MOTLEY FOOL SMALL-CAP GROWTH ETF
Portfolio Characteristics
(Unaudited)
AVERAGE ANNUAL TOTAL RETURNS FOR THE PERIODS ENDED AUGUST 31, 2022 | ||||
One |
Three |
Since
|
Inception
| |
Motley Fool Small-Cap Growth ETF |
-36.66% |
5.79% |
8.77% |
10/29/2018 |
Russell 2000 Growth Total Return® Index* |
-25.26% |
5.93% |
6.61%(1) |
— |
Fund Expense Ratio:(2) 0.85% |
The performance data quoted represents past performance and does not guarantee future results. Current performance may be lower or higher. The investment return and principal value of an investment will fluctuate so that shares, when redeemed or sold, may be worth more or less than their original cost.
(1) |
Benchmark performance is from inception date of the Fund only and is not the inception date of the benchmark itself. |
(2) |
The expense ratio of the Fund is set forth according to the Prospectus for the Fund and may differ from the expense ratio disclosed in the Financial Highlights table in this report. See the Financial Highlights for most current expense ratio. |
* |
The Russell 2000 Growth Total Return® Index measures the performance of those companies included in the Russell 2000 Index with higher price-to-book ratios and higher forecasted earnings growth rates. The Russell 2000 Index measures the performance of approximately 2,000 companies with small-market capitalizations. |
18 |
MOTLEY FOOL SMALL-CAP GROWTH ETF
Portfolio Characteristics (CONCLUDED)
(Unaudited)
The following tables show the top ten holdings and sector allocations, in which the Motley Fool Small-Cap Growth ETF was invested in as of August 31, 2022. Portfolio holdings are subject to change without notice.
Top TEN Holdings |
%
OF Net |
Watsco, Inc. |
6.6% |
Alarm.com Holdings, Inc. |
6.2 |
Ping Identity Holding Corp. |
5.5 |
Axon Enterprise, Inc. |
5.1 |
Paylocity Holding Corp. |
4.3 |
Globus Medical, Inc., Class A |
4.2 |
Penumbra, Inc. |
3.8 |
Heska Corp. |
3.8 |
Gentex Corp. |
3.4 |
RADA Electronic Industries Ltd. |
3.4 |
46.3% |
The Motley Fool Small-Cap Growth ETF uses GICSSM as the basis for the classification of securities on the Schedule of Investments.
Sector Allocation |
%
OF Net |
Information Technology |
25.0% |
Industrials |
22.5 |
Health Care |
20.5 |
Real Estate |
9.0 |
Consumer Discretionary |
7.5 |
Financials |
4.9 |
Energy |
2.8 |
Communication Services |
1.4 |
93.6% |
19 |
MOTLEY FOOL CAPITAL EFFICIENCY 100 INDEX ETF
Portfolio Characteristics
(Unaudited)
AVERAGE ANNUAL TOTAL RETURNS FOR THE PERIODS ENDED AUGUST 31, 2022 | ||
Since
|
Inception
| |
Motley Fool Capital Efficiency 100 Index ETF |
-23.13% |
12/30/2021 |
Motley Fool Capital Efficiency 100 Index* |
-23.07%(1) |
— |
S&P 500 Total Return Index** |
-16.36%(1) |
— |
Fund Expense Ratio:(2) 0.50% |
The performance data quoted represents past performance and does not guarantee future results. Current performance may be lower or higher. The investment return and principal value of an investment will fluctuate so that shares, when redeemed or sold, may be worth more or less than their original cost.
† |
Not annualized. |
(1) |
Benchmark performance is from inception date of the Fund only and is not the inception date of the benchmark itself. |
(2) |
The expense ratio of the Fund is set forth according to the Prospectus for the Fund and may differ from the expense ratio disclosed in the Financial Highlights table in this report. See the Financial Highlights for most current expense ratio. |
* |
The Motley Fool Capital Efficiency 100 Index (“Capital Efficiency 100 Index”) was developed by The Motley Fool, LLC (“The Motley Fool”), an affiliate of Motley Fool Asset Management, LLC (“Adviser”), in 2021 and is a proprietary, rules-based index designed to track the performance of the highest scoring stocks of U.S. companies, measured by a company’s capital efficiency, that have been recommended by The Motley Fool’s analysts and newsletters, and that also meet certain liquidity requirements. Capital efficiency is a measure of how a business turns its investments into revenue and profit and it provides insight into the company’s return on invested capital. Every company included in the Capital Efficiency 100 Index is incorporated and listed in the U.S. The Capital Efficiency 100 Index is calculated and administered by Solactive AG (the “Index Calculation Agent”), which is not affiliated with the Fund, the Adviser or The Motley Fool. Additional information regarding the Capital Efficiency 100 Index, including its value, is available on the websites of the Fund at www.fooletfs.com and the Index Calculation Agent, at www.solactive.com. You cannot invest directly in an index. |
** |
The S&P 500® Total Return Index is the total return version of the S&P 500® Index. Dividends are reinvested on a daily basis and all regular cash dividends are assumed reinvested in the index on the ex-dividend date. The S&P 500® Index is a market-capitalization-weighted index of 500 US stocks chosen for market size, liquidity and industry grouping, among other factors. The S&P 500® Index is designed to be a leading indicator of U.S. equities and is meant to reflect the risk/return characteristics of the large cap universe. The S&P 500® Index was first introduced on the 1st of January, 1923, though expanded to 500 stocks on March 4, 1957. |
20 |
MOTLEY FOOL CAPITAL EFFICIENCY 100 INDEX ETF
Portfolio Characteristics (CONCLUDED)
(Unaudited)
The following tables show the top ten holdings and sector allocations, in which the Motley Fool Capital Efficiency 100 Index ETF was invested in as of August 31, 2022. Portfolio holdings are subject to change without notice.
Top TEN Holdings |
%
OF Net |
Apple, Inc. |
5.6% |
Amazon.com, Inc. |
5.6 |
UnitedHealth Group, Inc. |
5.4 |
Home Depot, Inc., (The) |
5.0 |
Microsoft Corp. |
4.9 |
Visa, Inc., Class A |
4.9 |
Alphabet, Inc., Class C |
4.7 |
Meta Platforms, Inc., Class A |
4.6 |
Mastercard, Inc., Class A |
4.5 |
Johnson & Johnson |
4.4 |
49.6% |
The Motley Fool Capital Efficiency 100 Index ETF uses GICSSM as the basis for the classification of securities on the Schedule of Investments.
Sector Allocation |
%
OF Net |
Information Technology |
43.6% |
Health Care |
17.0 |
Consumer Discretionary |
16.3 |
Communication Services |
12.2 |
Industrials |
5.4 |
Consumer Staples |
4.1 |
Materials |
0.8 |
Financials |
0.4 |
99.8% |
21 |
MOTLEY FOOL NEXT INDEX ETF
Portfolio Characteristics
(Unaudited)
AVERAGE ANNUAL TOTAL RETURNS FOR THE PERIODS ENDED AUGUST 31, 2022 | ||
Since
|
Inception
| |
Motley Fool Next Index ETF |
-24.88% |
12/30/2021 |
Motley Fool Next Index* |
-24.72%(1) |
— |
Russell Midcap® Growth Total Return Index** |
-25.42%(1) |
— |
Fund Expense Ratio:(2) 0.50% |
The performance data quoted represents past performance and does not guarantee future results. Current performance may be lower or higher. The investment return and principal value of an investment will fluctuate so that shares, when redeemed or sold, may be worth more or less than their original cost.
† |
Not annualized. |
(1) |
Benchmark performance is from inception date of the Fund only and is not the inception date of the benchmark itself. |
(2) |
The expense ratio of the Fund is set forth according to the Prospectus for the Fund and may differ from the expense ratio disclosed in the Financial Highlights table in this report. See the Financial Highlights for most current expense ratio. |
* |
The Motley Fool Next Index (“Next Index”) was developed by The Motley Fool, LLC (“The Motley Fool”), an affiliate of Motley Fool Asset Management, LLC (“Adviser”), in 2021 and is a proprietary, rules-based index designed to track the performance of the 100 largest, most liquid U.S. companies that have been recommended by The Motley Fool’s analysts and newsletters. Every company included in the Capital Efficiency 100 Index is incorporated and listed in the U.S. The Next Index is calculated and administered by Solactive AG (the “Index Calculation Agent”), which is not affiliated with the Fund, the Adviser or The Motley Fool. Additional information regarding the Next Index, including its value, is available on the websites of the Fund at www.fooletfs.com and the Index Calculation Agent, at www.solactive.com. You cannot invest directly in an index. |
** |
The Russell Midcap® Growth Total Return Index measures the performance of the mid-cap growth segment of the U.S. equity universe. It includes those Russell Midcap® Index companies with higher price-to-book ratios and higher forecasted growth values. The Russell Midcap® Growth Total Return Index is constructed to provide a comprehensive and unbiased barometer of the mid-cap growth market. The Index is completely reconstituted annually to ensure larger stocks do not distort the performance and characteristics of the true mid-cap growth market. |
22 |
MOTLEY FOOL NEXT INDEX ETF
Portfolio Characteristics (CONCLUDED)
(Unaudited)
The following tables show the top ten holdings and sector allocations, in which the Motley Fool Next Index ETF was invested in as of August 31, 2022. Portfolio holdings are subject to change without notice.
Top TEN Holdings |
%
OF Net |
Arista Networks, Inc. |
2.3% |
Warner Bros Discovery, Inc. |
2.0 |
Trade Desk, Inc., (The), Class A |
1.9 |
Cummins, Inc. |
1.9 |
Nasdaq, Inc. |
1.8 |
Corning, Inc. |
1.8 |
Seagen, Inc. |
1.8 |
Alnylam Pharmaceuticals, Inc. |
1.5 |
EPAM Systems, Inc. |
1.5 |
Sirius XM Holdings, Inc. |
1.5 |
18.0% |
The Motley Fool Next Index ETF uses GICSSM as the basis for the classification of securities on the Schedule of Investments.
Sector Allocation |
%
OF Net |
Information Technology |
37.5% |
Consumer Discretionary |
14.6 |
Health Care |
13.4 |
Industrials |
12.1 |
Communication Services |
8.5 |
Financials |
8.1 |
Consumer Staples |
3.3 |
Materials |
1.0 |
Real Estate |
1.0 |
Energy |
0.2 |
99.7% |
23 |
Motley Fool Asset Management ETFs
Fund Expense Examples
AUGUST 31, 2022 (Unaudited)
As a shareholder of the Fund(s), you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, (if any), including brokerage commissions on purchases and sales of Fund shares, and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees. These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Fund(s) and to compare these costs with the ongoing costs of investing in other ETFs.
These examples are based on an investment of $1,000 invested at the beginning of the six-month period from March 1, 2022 through August 31, 2022, and held for the entire period.
Actual Expenses
The first line of the accompanying table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Examples for Comparison Purposes
The second line of the accompanying table provides information about hypothetical account values and hypothetical expenses based on each Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in a Fund and other funds. To do so, compare these 5% hypothetical examples with the 5% hypothetical examples that appear in the shareholder reports of other funds.
Please note that the expenses shown in the accompanying table are meant to highlight your ongoing costs only and do not reflect any transactional costs. Therefore, the second line of the accompanying table is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Do you know how many times a fund, or the market, has returned a smooth 5% over a long period of time? Never. But we have to pick some example. In reality, the market’s returns are always far bumpier, with the market returning 20% one year, followed by a loss of 10% the next year, followed by a 3% gain,etc. These variations affect actual expenses as well. Happily, over almost all time periods of 20 years or longer, according to the research of University of Pennsylvania’s Jeremy Siegel and others, the domestic market’s returns have been at least 5% per year on average. |
24 |
Motley Fool Asset Management ETFs
Fund Expense Examples (Concluded)
AUGUST 31, 2022 (Unaudited)
|
Beginning |
Ending |
Expenses |
Annualized
|
Actual
Six-Month Total Investment Returns |
Motley Fool Global Opportunities ETF |
|||||
Actual |
$ 1,000.00 |
$ 877.40 |
$ 4.02 |
0.85% |
-12.26% |
Hypothetical (5% return before expenses) |
1,000.00 |
1,020.92 |
4.33 |
0.85% |
N/A |
Motley Fool Mid-Cap Growth ETF |
|||||
Actual |
$ 1,000.00 |
$ 878.50 |
$ 4.02 |
0.85% |
-12.15% |
Hypothetical (5% return before expenses) |
1,000.00 |
1,020.92 |
4.33 |
0.85% |
N/A |
Motley Fool 100 Index ETF |
|
|
|
| |
Actual |
$ 1,000.00 |
$ 874.50 |
$ 2.36 |
0.50% |
-12.55% |
Hypothetical (5% return before expenses) |
1,000.00 |
1,022.68 |
2.55 |
0.50% |
N/A |
Motley Fool Small-Cap Growth ETF |
|||||
Actual |
$ 1,000.00 |
$ 812.70 |
$ 3.88 |
0.85% |
-18.73% |
Hypothetical (5% return before expenses) |
1,000.00 |
1,020.92 |
4.33 |
0.85% |
N/A |
Motley Fool Capital Efficiency 100 Index ETF |
|||||
Actual |
$ 1,000.00 |
$ 879.60 |
$ 2.37 |
0.50% |
-12.04% |
Hypothetical (5% return before expenses) |
1,000.00 |
1,022.68 |
2.52 |
0.50% |
N/A |
Motley Fool Next Index ETF |
|||||
Actual |
$ 1,000.00 |
$ 858.00 |
$ 2.34 |
0.50% |
-14.20% |
Hypothetical (5% return before expenses) |
1,000.00 |
1,022.68 |
2.52 |
0.50% |
N/A |
(1) |
Expenses are equal to the Fund’s annualized expense ratio for the period March 1, 2022 through August 31, 2022, multiplied by the average account value over the period, multiplied by the number of days (184) in the most recent fiscal half-year, then divided by 365 to reflect the one-half year period. The Fund’s ending account value in the first section in the table is based on the actual since inception total investment return for the Fund. |
25 |
Motley Fool global opportunities ETF
Schedule of Investments
AUGUST 31, 2022
|
Number
of |
Value |
||||||
|
||||||||
Common Stocks — 97.7% |
||||||||
Aerospace & Defense — 3.6% |
||||||||
Axon Enterprise, Inc. (United States)(a)* |
131,952 | $ | 15,396,159 | |||||
Banks — 6.9% |
||||||||
Bank of Georgia Group PLC (Georgia) |
257,804 | 5,989,800 | ||||||
HDFC Bank., Ltd., ADR (India) |
185,356 | 11,315,984 | ||||||
Signature Bank/NY (United States) |
52,188 | 9,099,500 | ||||||
SVB Financial Group (United States)(a)* |
8,544 | 3,473,307 | ||||||
29,878,591 | ||||||||
Capital Markets — 3.4% |
||||||||
Brookfield Asset Management, Inc., Class A (Canada) |
261,710 | 12,590,868 | ||||||
Georgia Capital PLC (Georgia)* |
273,377 | 2,172,255 | ||||||
14,763,123 | ||||||||
Commercial Services & Supplies — 4.4% |
||||||||
Waste Connections, Inc. (Canada) |
136,376 | 18,980,812 | ||||||
Diversified Telecommunication Services — 3.7% |
||||||||
Cellnex Telecom SA (Spain)*(d) |
413,330 | 16,104,198 | ||||||
Entertainment — 2.1% |
||||||||
Universal Music Group NV (Netherlands) |
461,736 | 9,190,452 | ||||||
Equity Real Estate Investment Trusts (REITs) — 7.3% |
||||||||
American Tower Corp. (United States) |
39,624 | 10,066,477 | ||||||
Equinix, Inc. (United States) |
17,600 | 11,569,712 | ||||||
SBA Communications Corp. (United States) |
31,276 | 10,172,519 | ||||||
31,808,708 | ||||||||
Food & Staples Retailing — 2.5% |
||||||||
Costco Wholesale Corp. (United States) |
20,302 | 10,599,674 | ||||||
Health Care Equipment & Supplies — 4.1% |
||||||||
Medtronic PLC (Ireland) |
129,536 | 11,388,805 | ||||||
ResMed, Inc. (United States) |
28,160 | 6,192,947 | ||||||
17,581,752 | ||||||||
Health Care Providers & Services — 0.0% |
||||||||
NMC Health PLC (United Arab Emirates)(b)* |
485,482 | — |
The accompanying notes are an integral part of these financial statements.
26 |
Motley Fool global opportunities ETF
Schedule of Investments (continued)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
|
||||||||
Common Stocks (continued) | ||||||||
Hotels, Restaurants & Leisure — 5.8% |
||||||||
Starbucks Corp. (United States) |
136,376 | $ | 11,465,130 | |||||
Yum China Holdings, Inc. (China)(a) |
272,301 | 13,645,003 | ||||||
25,110,133 | ||||||||
Insurance — 2.4% |
||||||||
Aon PLC, Class A (United Kingdom) |
37,948 | 10,597,359 | ||||||
Interactive Media & Services — 4.0% |
||||||||
Alphabet, Inc., Class C (United States)* |
159,304 | 17,388,032 | ||||||
Internet & Direct Marketing Retail — 8.4% |
||||||||
Amazon.com, Inc. (United States)* |
200,980 | 25,478,235 | ||||||
MercadoLibre, Inc., Class A (Uruguay)* |
12,659 | 10,828,002 | ||||||
36,306,237 | ||||||||
IT Services — 7.3% |
||||||||
Mastercard, Inc., Class A (United States) |
75,632 | 24,532,752 | ||||||
PayPal Holdings, Inc. (United States)* |
77,340 | 7,226,649 | ||||||
31,759,401 | ||||||||
Life Sciences Tools & Services — 3.4% |
||||||||
ICON PLC (Ireland)* |
70,400 | 14,772,032 | ||||||
Machinery — 0.5% |
||||||||
FANUC Corp. (Japan) |
14,080 | 2,283,914 | ||||||
Media — 2.1% |
||||||||
Comcast Corp., Class A (United States) |
206,680 | 7,479,749 | ||||||
System1 Group PLC (United Kingdom)* |
567,240 | 1,449,714 | ||||||
8,929,463 | ||||||||
Real Estate Management & Development — 1.3% |
||||||||
Jones Lang LaSalle, Inc. (United States)* |
32,202 | 5,570,946 | ||||||
Road & Rail — 2.0% |
||||||||
Canadian National Railway Co. (Canada) |
71,394 | 8,489,461 | ||||||
Semiconductors & Semiconductor Equipment — 3.1% |
||||||||
Taiwan Semiconductor Manufacturing Co., Ltd., SP ADR (Taiwan) |
161,724 | 13,479,695 |
The accompanying notes are an integral part of these financial statements.
27 |
Motley Fool global opportunities ETF
Schedule of Investments (continued)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
|
||||||||
Common Stocks (continued) | ||||||||
Software — 9.2% |
||||||||
Atlassian Corp., PLC, Class A (Australia)*ADR |
82,672 | $ | 20,474,547 | |||||
Everbridge, Inc. (United States)(a)* |
99,868 | 3,972,749 | ||||||
Paycom Software, Inc. (United States)* |
32,584 | 11,443,501 | ||||||
Splunk, Inc. (United States)* |
45,760 | 4,119,773 | ||||||
40,010,570 | ||||||||
Trading Companies & Distributors — 6.8% |
||||||||
Fastenal Co. (United States) |
161,222 | 8,114,303 | ||||||
Watsco, Inc. (United States)(a) |
79,152 | 21,531,719 | ||||||
29,646,022 | ||||||||
Transportation Infrastructure — 3.2% |
||||||||
International Container Terminal Services, Inc. (Philippines) |
4,331,453 | 13,976,659 | ||||||
Wireless Telecommunication Services — 0.2% |
||||||||
Safaricom PLC (Kenya) |
4,000,000 | 930,116 | ||||||
Total Common Stocks (Cost $256,755,317) |
423,553,509 | |||||||
Investments Purchased with Proceeds from Securities Lending Collateral — 7.8% |
||||||||
Mount Vernon Liquid Assets Portfolio, LLC, 2.44% |
33,805,832 | 33,805,832 | ||||||
Total Investments Purchased with Proceeds from Securities Lending Collateral (Cost $33,805,832) |
33,805,832 | |||||||
The accompanying notes are an integral part of these financial statements.
28 |
Motley Fool global opportunities ETF
Schedule of Investments (CONCLUDED)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
|
||||||||
Short-Term Investments — 2.1% |
||||||||
U.S. Bank Money Market Deposit Account, 2.00% (United States)(c) |
9,326,426 | $ | 9,326,426 | |||||
Total Short-Term Investments (Cost $9,326,426) |
9,326,426 | |||||||
Total Investments (Cost $299,887,575) — 107.6% |
466,685,767 | |||||||
Liabilities in Excess of Other Assets — (7.6)% |
(33,033,724 | ) | ||||||
NET ASSETS — 100.0% |
||||||||
(Applicable to 17,518,873 shares outstanding) |
$ | 433,652,043 |
* |
Non-income producing security. |
ADR — American Depositary Receipt
PLC — Public Limited Company
SP ADR — Sponsored ADR
(a) |
All or a portion of the security is on loan. At August 31, 2022, the market value of securities on loan was $32,824,775. |
(b) |
Security has been valued at fair market value using significant unobservable inputs as determined in good faith by or under the direction of The RBB Fund, Inc.’s Board of Directors. As of August 31, 2022, these securities amounted to $0 or 0% of net assets. |
(c) |
The rate shown is as of August 31, 2022. |
(d) |
Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration to qualified institutional buyers. As of August 31, 2022, total market value of Rule 144A securities is $16,104,198 and represents 3.7% of net assets. |
The accompanying notes are an integral part of these financial statements.
29 |
Motley Fool mid-cap growth ETF
Schedule of Investments
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks — 93.8% |
||||||||
Aerospace & Defense — 4.4% |
||||||||
Axon Enterprise, Inc. (United States)* |
79,848 | $ | 9,316,665 | |||||
Air Freight & Logistics — 1.9% |
||||||||
GXO Logistics, Inc. (United States)* |
88,688 | 3,935,973 | ||||||
Auto Components — 6.2% |
||||||||
Gentex Corp. (United States) |
266,066 | 7,260,941 | ||||||
LCI Industries (United States) |
49,163 | 5,696,517 | ||||||
12,957,458 | ||||||||
Automobiles — 2.5% |
||||||||
Thor Industries, Inc. (United States)(a) |
64,322 | 5,210,725 | ||||||
Banks — 3.1% |
||||||||
SVB Financial Group (United States)(a)* |
15,979 | 6,495,783 | ||||||
Biotechnology — 0.2% |
||||||||
Ultragenyx Pharmaceutical, Inc. (United States)* |
9,778 | 466,313 | ||||||
Electronic Equipment, Instruments & Components — 2.3% |
||||||||
Cognex Corp. (United States) |
113,111 | 4,763,104 | ||||||
Equity Real Estate Investment Trusts (REITs) — 6.2% |
||||||||
SBA Communications Corp. (United States) |
39,924 | 12,985,281 | ||||||
Health Care Equipment & Supplies — 8.8% |
||||||||
Cooper Companies, Inc., (The) (United States) |
22,080 | 6,346,675 | ||||||
Heska Corp. (United States)(a)* |
24,051 | 2,190,325 | ||||||
ResMed, Inc. (United States) |
44,813 | 9,855,275 | ||||||
18,392,275 | ||||||||
Health Care Providers & Services — 2.7% |
||||||||
HealthEquity, Inc. (United States)(a)* |
84,273 | 5,568,760 | ||||||
Insurance — 10.4% |
||||||||
Brown & Brown, Inc. (United States) |
177,376 | 11,181,783 | ||||||
Goosehead Insurance, Inc., Class A (United States)* |
20,000 | 1,040,000 | ||||||
Markel Corp. (United States)* |
7,913 | 9,448,993 | ||||||
21,670,776 | ||||||||
IT Services — 4.0% |
||||||||
Broadridge Financial Solutions, Inc. (United States) |
48,796 | 8,352,411 |
The accompanying notes are an integral part of these financial statements.
30 |
Motley Fool mid-cap growth ETF
Schedule of Investments (continued)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks (continued) | ||||||||
Real Estate Management & Development — 3.6% |
||||||||
Jones Lang LaSalle, Inc. (United States)* |
43,048 | 7,447,304 | ||||||
Road & Rail — 2.2% |
||||||||
XPO Logistics, Inc. (United States)(a)* |
88,688 | 4,649,025 | ||||||
Software — 21.8% |
||||||||
Alarm.com Holdings, Inc. (United States)* |
121,439 | 8,087,838 | ||||||
ANSYS, Inc. (United States)* |
7,107 | 1,764,668 | ||||||
Avalara, Inc. (United States)* |
22,047 | 2,019,285 | ||||||
Everbridge, Inc. (United States)* |
33,490 | 1,332,232 | ||||||
Paycom Software, Inc. (United States)* |
19,872 | 6,979,046 | ||||||
Paylocity Holding Corp. (United States)* |
43,695 | 10,530,495 | ||||||
Splunk, Inc. (United States)* |
60,339 | 5,432,320 | ||||||
Tyler Technologies, Inc. (United States)* |
25,204 | 9,363,538 | ||||||
45,509,422 | ||||||||
Specialty Retail — 1.9% |
||||||||
Tractor Supply Co. (United States) |
22,027 | 4,078,299 | ||||||
Trading Companies & Distributors — 11.6% |
||||||||
Fastenal Co. (United States) |
171,598 | 8,636,527 | ||||||
Watsco, Inc. (United States)(a) |
57,668 | 15,687,426 | ||||||
24,323,953 | ||||||||
Total Common Stocks (Cost $110,089,287) |
196,123,527 | |||||||
Investments Purchased with Proceeds from Securities Lending Collateral — 15.0% |
||||||||
Mount Vernon Liquid Assets Portfolio, LLC, 2.44% |
31,234,388 | 31,234,388 | ||||||
Total Investments Purchased with Proceeds from Securities Lending Collateral (Cost $31,234,388) |
31,234,388 | |||||||
The accompanying notes are an integral part of these financial statements.
31 |
Motley Fool mid-cap growth ETF
Schedule of Investments (CONCLUDED)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Short-Term Investments — 6.5% |
||||||||
U.S. Bank Money Market Deposit Account, 2.00% (United States)(b) |
13,654,888 | $ | 13,654,888 | |||||
Total Short-Term Investments (Cost $13,654,888) |
13,654,888 | |||||||
Total Investments (Cost $154,978,563) — 115.3% |
241,012,803 | |||||||
Liabilities in Excess of Other Assets — (15.3)% |
(31,968,788 | ) | ||||||
NET ASSETS — 100.0% |
||||||||
(Applicable to 9,217,511 shares outstanding) |
$ | 209,044,015 |
* |
Non-income producing security. |
(a) |
All or a portion of the security is on loan. At August 31, 2022, the market value of securities on loan was $30,222,704. |
(b) |
The rate shown is as of August 31, 2022. |
The accompanying notes are an integral part of these financial statements.
32 |
Motley Fool 100 Index ETF
Schedule of Investments
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks — 99.8% |
||||||||
Aerospace & Defense — 0.2% |
||||||||
TransDigm Group, Inc. (United States) |
1,262 | $ | 757,692 | |||||
Air Freight & Logistics — 0.3% |
||||||||
FedEx Corp. (United States) |
5,987 | 1,262,119 | ||||||
Automobiles — 4.7% |
||||||||
Tesla, Inc. (United States)* |
71,689 | 19,758,205 | ||||||
Banks — 2.0% |
||||||||
JPMorgan Chase & Co. (United States) |
67,587 | 7,686,669 | ||||||
SVB Financial Group (United States)(a)* |
1,361 | 553,274 | ||||||
8,239,943 | ||||||||
Beverages — 0.3% |
||||||||
Monster Beverage Corp. (United States)* |
12,234 | 1,086,746 | ||||||
Biotechnology — 2.0% |
||||||||
Amgen, Inc. (United States) |
12,339 | 2,965,062 | ||||||
Biogen, Inc. (United States)* |
3,384 | 661,166 | ||||||
Gilead Sciences, Inc. (United States) |
28,969 | 1,838,662 | ||||||
Moderna, Inc. (United States)(a)* |
9,188 | 1,215,297 | ||||||
Vertex Pharmaceuticals, Inc. (United States)* |
5,907 | 1,664,356 | ||||||
8,344,543 | ||||||||
Capital Markets — 2.4% |
||||||||
Charles Schwab Corp., (The) (United States) |
43,796 | 3,107,326 | ||||||
CME Group, Inc. (United States) |
8,302 | 1,623,954 | ||||||
Intercontinental Exchange, Inc. (United States) |
12,944 | 1,305,402 | ||||||
Moody’s Corp. (United States) |
4,256 | 1,210,917 | ||||||
S&P Global, Inc. (United States)(a) |
7,486 | 2,636,420 | ||||||
9,884,019 | ||||||||
Chemicals — 0.6% |
||||||||
Ecolab, Inc. (United States) |
6,598 | 1,080,950 | ||||||
Sherwin-Williams Co., (The) (United States) |
5,979 | 1,387,726 | ||||||
2,468,676 | ||||||||
Commercial Services & Supplies — 0.8% |
||||||||
Cintas Corp. (United States) |
2,365 | 962,177 | ||||||
Copart, Inc. (United States)* |
4,990 | 597,053 |
The accompanying notes are an integral part of these financial statements.
33 |
Motley Fool 100 Index ETF
Schedule of Investments (continued)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks (continued) | ||||||||
Commercial Services & Supplies (continued) | ||||||||
Waste Management, Inc. (United States) |
9,590 | $ | 1,620,998 | |||||
3,180,228 | ||||||||
Diversified Financial Services — 3.4% |
||||||||
Berkshire Hathaway, Inc., Class B (United States)* |
51,009 | 14,323,327 | ||||||
Electric Utilities — 0.9% |
||||||||
NextEra Energy, Inc. (United States)(a) |
45,371 | 3,859,257 | ||||||
Entertainment — 2.3% |
||||||||
Activision Blizzard, Inc. (United States) |
18,059 | 1,417,451 | ||||||
Electronic Arts, Inc. (United States) |
6,458 | 819,327 | ||||||
Netflix, Inc. (United States)* |
10,262 | 2,294,173 | ||||||
ROBLOX Corp., Class A (United States)(a)* |
13,756 | 537,997 | ||||||
Walt Disney Co., (The) (United States) |
42,068 | 4,714,981 | ||||||
9,783,929 | ||||||||
Equity Real Estate Investment Trusts (REITs) — 1.6% |
||||||||
American Tower Corp. (United States) |
10,689 | 2,715,541 | ||||||
Crown Castle, Inc. (United States) |
10,002 | 1,708,642 | ||||||
Digital Realty Trust, Inc. (United States) |
6,575 | 812,867 | ||||||
Equinix, Inc. (United States) |
2,103 | 1,382,449 | ||||||
6,619,499 | ||||||||
Food & Staples Retailing — 1.3% |
||||||||
Costco Wholesale Corp. (United States) |
10,233 | 5,342,649 | ||||||
Health Care Equipment & Supplies — 1.4% |
||||||||
Align Technology, Inc. (United States)* |
1,821 | 443,778 | ||||||
Becton Dickinson and Co. (United States) |
6,584 | 1,661,933 | ||||||
Dexcom, Inc. (United States)* |
9,152 | 752,386 | ||||||
IDEXX Laboratories, Inc. (United States)* |
1,941 | 674,731 | ||||||
Intuitive Surgical, Inc. (United States)* |
8,291 | 1,705,790 | ||||||
ResMed, Inc. (United States) |
3,383 | 743,989 | ||||||
5,982,607 | ||||||||
Health Care Providers & Services — 4.0% |
||||||||
CVS Health Corp. (United States) |
30,285 | 2,972,473 | ||||||
HCA Healthcare, Inc. (United States) |
6,826 | 1,350,661 | ||||||
McKesson Corp. (United States) |
3,317 | 1,217,339 |
The accompanying notes are an integral part of these financial statements.
34 |
Motley Fool 100 Index ETF
Schedule of Investments (continued)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks (continued) | ||||||||
Health Care Providers & Services (continued) | ||||||||
UnitedHealth Group, Inc. (United States) |
21,668 | $ | 11,252,842 | |||||
16,793,315 | ||||||||
Health Care Technology — 0.2% |
||||||||
Veeva Systems, Inc., Class A (United States)* |
3,608 | 719,147 | ||||||
Hotels, Restaurants & Leisure — 1.9% |
||||||||
Airbnb, Inc., Class A (United States)* |
14,700 | 1,662,864 | ||||||
Booking Holdings, Inc. (United States)* |
939 | 1,761,386 | ||||||
Chipotle Mexican Grill, Inc. (United States)(a)* |
646 | 1,031,533 | ||||||
Marriott International, Inc., Class A (United States) |
7,560 | 1,162,274 | ||||||
Starbucks Corp. (United States) |
26,488 | 2,226,846 | ||||||
7,844,903 | ||||||||
Industrial Conglomerates — 0.4% |
||||||||
3M Co. (United States)(a) |
13,144 | 1,634,456 | ||||||
Insurance — 0.2% |
||||||||
Aflac, Inc. (United States)(a) |
14,878 | 884,051 | ||||||
Interactive Media & Services — 10.6% |
||||||||
Alphabet, Inc., Class C (United States)* |
302,620 | 33,030,973 | ||||||
Match Group, Inc. (United States)* |
6,691 | 378,242 | ||||||
Meta Platforms, Inc., Class A (United States)* |
62,503 | 10,183,614 | ||||||
Twitter, Inc. (United States)* |
17,621 | 682,814 | ||||||
44,275,643 | ||||||||
Internet & Direct Marketing Retail — 7.3% |
||||||||
Amazon.com, Inc. (United States)* |
234,600 | 29,740,242 | ||||||
eBay, Inc. (United States)(a) |
12,931 | 570,645 | ||||||
30,310,887 | ||||||||
IT Services — 5.4% |
||||||||
Cognizant Technology Solutions Corp., Class A (United States) |
12,038 | 760,440 | ||||||
Mastercard, Inc., Class A (United States) |
22,464 | 7,286,648 | ||||||
PayPal Holdings, Inc. (United States)* |
26,746 | 2,499,146 | ||||||
Snowflake, Inc. Class A (United States)(a)* |
7,186 | 1,300,307 |
The accompanying notes are an integral part of these financial statements.
35 |
Motley Fool 100 Index ETF
Schedule of Investments (continued)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks (continued) | ||||||||
IT Services (continued) | ||||||||
Block, Inc., Class A (United States)* |
13,498 | $ | 930,147 | |||||
Twilio, Inc., Class A (United States)(a)* |
4,268 | 296,967 | ||||||
Visa, Inc., Class A (United States)(a) |
48,112 | 9,560,336 | ||||||
22,633,991 | ||||||||
Life Sciences Tools & Services — 0.2% |
||||||||
Illumina, Inc. (United States)* |
3,629 | 731,752 | ||||||
Oil, Gas & Consumable Fuels — 0.2% |
||||||||
Kinder Morgan, Inc. (United States) |
52,368 | 959,382 | ||||||
Pharmaceuticals — 3.1% |
||||||||
Bristol-Myers Squibb Co. (United States) |
49,172 | 3,314,684 | ||||||
Johnson & Johnson (United States) |
60,773 | 9,805,116 | ||||||
13,119,800 | ||||||||
Professional Services — 0.1% |
||||||||
CoStar Group, Inc. (United States)* |
8,383 | 583,792 | ||||||
Road & Rail — 1.3% |
||||||||
Old Dominion Freight Line, Inc. (United States)(a) |
2,619 | 710,823 | ||||||
Uber Technologies, Inc. (United States)* |
45,741 | 1,315,511 | ||||||
Union Pacific Corp. (United States) |
14,505 | 3,256,518 | ||||||
5,282,852 | ||||||||
Semiconductors & Semiconductor Equipment — 5.9% |
||||||||
Advanced Micro Devices, Inc. (United States)* |
36,916 | 3,133,061 | ||||||
Broadcom, Inc. (United States) |
9,328 | 4,655,698 | ||||||
Lam Research Corp. (United States) |
3,205 | 1,403,502 | ||||||
NVIDIA Corp. (United States) |
57,831 | 8,729,011 | ||||||
QUALCOMM, Inc. (United States) |
25,564 | 3,381,350 | ||||||
Texas Instruments, Inc. (United States) |
20,361 | 3,363,841 | ||||||
24,666,463 | ||||||||
Software — 16.5% |
||||||||
Adobe, Inc. (United States)* |
10,913 | 4,075,351 | ||||||
Autodesk, Inc. (United States)* |
5,019 | 1,012,533 | ||||||
Cadence Design Systems, Inc. (United States)* |
6,370 | 1,106,915 | ||||||
Crowdstrike Holdings, Inc., Class A (United States)* |
5,401 | 986,276 | ||||||
Datadog, Inc., Class A (United States)* |
7,366 | 773,062 |
The accompanying notes are an integral part of these financial statements.
36 |
Motley Fool 100 Index ETF
Schedule of Investments (Continued)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks (continued) | ||||||||
Software (continued) | ||||||||
Fortinet, Inc. (United States)* |
18,538 | $ | 902,615 | |||||
Intuit, Inc. (United States) |
6,515 | 2,813,047 | ||||||
Microsoft Corp. (United States) |
172,451 | 45,090,763 | ||||||
Palo Alto Networks, Inc. (United States)* |
2,302 | 1,281,776 | ||||||
Roper Technologies, Inc. (United States) |
2,488 | 985,516 | ||||||
Salesforce, Inc. (United States)* |
22,981 | 3,587,794 | ||||||
ServiceNow, Inc. (United States)* |
4,630 | 2,012,290 | ||||||
Synopsys, Inc. (United States)* |
3,533 | 1,222,489 | ||||||
VMware, Inc., Class A (United States) |
9,734 | 1,129,436 | ||||||
Workday, Inc., Class A (United States)* |
5,894 | 969,917 | ||||||
Zoom Video Communications, Inc., Class A (United States)* |
6,892 | 554,117 | ||||||
Zscaler, Inc. (United States)* |
3,324 | 529,314 | ||||||
69,033,211 | ||||||||
Specialty Retail — 2.3% |
||||||||
Home Depot, Inc., (The) (United States) |
23,737 | 6,846,226 | ||||||
Lowe’s Cos, Inc. (United States) |
14,073 | 2,732,132 | ||||||
9,578,358 | ||||||||
Technology Hardware, Storage & Peripherals — 14.1% |
||||||||
Apple, Inc. (United States) |
373,196 | 58,673,875 | ||||||
Textiles, Apparel & Luxury Goods — 0.9% |
||||||||
NIKE, Inc., Class B (United States) |
36,347 | 3,869,138 | ||||||
Wireless Telecommunication Services — 1.0% |
||||||||
T-Mobile US, Inc. (United States)(a)* |
28,953 | 4,168,075 | ||||||
Total Common Stocks (Cost $321,461,306) |
416,656,530 | |||||||
Rights — 0.0% |
||||||||
Altaba, Inc. - Escrow Shares (United States)*(b) |
8,565 | 32,547 | ||||||
Total Rights (Cost $8,126) |
32,547 | |||||||
Investments Purchased with Proceeds from Securities Lending Collateral — 5.1% |
||||||||
Mount Vernon Liquid Assets Portfolio, LLC, 2.44% |
21,230,044 | 21,230,044 | ||||||
Total Investments Purchased with Proceeds from Securities Lending Collateral (Cost $21,230,044) |
21,230,044 | |||||||
The accompanying notes are an integral part of these financial statements.
37 |
Motley Fool 100 Index ETF
Schedule of Investments (Concluded)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Short-Term Investments — 0.1% |
||||||||
U.S. Bank Money Market Deposit Account, 2.00% (United States)(c) |
387,749 | $ | 387,749 | |||||
Total Short-Term Investments (Cost $387,749) |
387,749 | |||||||
Total Investments (Cost $343,087,225) — 105.0% |
438,306,870 | |||||||
Liabilities in Excess of Other Assets — (5.0)% |
(21,038,133 | ) | ||||||
NET ASSETS — 100.0% |
||||||||
(Applicable to 12,275,000 shares outstanding) |
$ | 417,268,737 |
* |
Non-income producing security. |
(a) |
All or a portion of the security is on loan. At August 31, 2022, the market value of securities on loan was $20,543,351. |
(b) |
Security has been valued at fair market value using significant unobservable inputs as determined in good faith by or under the direction of The RBB Fund, Inc.’s Board of Directors. As of August 31, 2022, these securities amounted to $32,547 or 0.0% of net assets. |
(c) |
The rate shown is as of August 31, 2022. |
The accompanying notes are an integral part of these financial statements.
38 |
MOTLEY FOOL Small-Cap Growth ETF
Schedule of Investments
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks — 93.6% |
||||||||
Aerospace & Defense — 8.5% |
||||||||
Axon Enterprise, Inc. (United States)* |
34,080 | $ | 3,976,455 | |||||
RADA Electronic Industries Ltd. (Israel)* |
263,872 | 2,646,636 | ||||||
6,623,091 | ||||||||
Auto Components — 6.0% |
||||||||
Fox Factory Holding Corp. (United States)* |
21,699 | 2,022,564 | ||||||
Gentex Corp. (United States) |
97,264 | 2,654,334 | ||||||
4,676,898 | ||||||||
Banks — 1.9% |
||||||||
Live Oak Bancshares, Inc. (United States) |
41,339 | 1,498,125 | ||||||
Biotechnology — 4.3% |
||||||||
PTC Therapeutics, Inc. (United States)(a)* |
37,374 | 1,866,458 | ||||||
Ultragenyx Pharmaceutical, Inc. (United States)* |
31,141 | 1,485,114 | ||||||
3,351,572 | ||||||||
Building Products — 1.2% |
||||||||
Trex Co., Inc. (United States)(a)* |
19,795 | 926,208 | ||||||
Electronic Equipment, Instruments & Components — 1.8% |
||||||||
nLight, Inc. (United States)* |
112,358 | 1,403,351 | ||||||
Equity Real Estate Investment Trusts (REITs) — 2.6% |
||||||||
STAG Industrial, Inc. (United States) |
65,887 | 2,029,320 | ||||||
Health Care Equipment & Supplies — 13.9% |
||||||||
Globus Medical, Inc., Class A (United States)(a)* |
54,782 | 3,242,547 | ||||||
Heska Corp. (United States)(a)* |
32,615 | 2,970,248 | ||||||
Mesa Laboratories, Inc. (United States)(a) |
9,528 | 1,627,954 | ||||||
Penumbra, Inc. (United States)(a)* |
18,228 | 2,992,491 | ||||||
10,833,240 | ||||||||
Health Care Providers & Services — 1.1% |
||||||||
HealthEquity, Inc. (United States)* |
12,794 | 845,428 | ||||||
Health Care Technology — 1.2% |
||||||||
Schrodinger, Inc. (United States)(a)* |
35,387 | 971,019 | ||||||
Insurance — 2.9% |
||||||||
Goosehead Insurance, Inc., Class A (United States)(a)* |
43,989 | 2,287,428 |
The accompanying notes are an integral part of these financial statements.
39 |
MOTLEY FOOL Small-Cap Growth ETF
Schedule of Investments (CONTINUED)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks (continued) | ||||||||
Leisure Products — 1.5% |
||||||||
Clarus Corp. (United States)(a) |
77,500 | $ | 1,175,675 | |||||
Machinery — 2.9% |
||||||||
John Bean Technologies Corp. (United States) |
21,662 | 2,236,818 | ||||||
Media — 1.4% |
||||||||
Cardlytics, Inc. (United States)* |
79,641 | 1,054,447 | ||||||
Oil, Gas & Consumable Fuels — 2.8% |
||||||||
Northern Oil and Gas, Inc. (United States) |
70,308 | 2,224,545 | ||||||
Real Estate Management & Development — 6.4% |
||||||||
Howard Hughes Corp., (The) (United States)* |
38,908 | 2,475,716 | ||||||
Jones Lang LaSalle, Inc. (United States)* |
8,163 | 1,412,199 | ||||||
Newmark Group, Inc., Class A (United States)(a) |
110,373 | 1,131,323 | ||||||
5,019,238 | ||||||||
Road & Rail — 3.4% |
||||||||
Landstar System, Inc. (United States)(a) |
17,980 | 2,636,407 | ||||||
Software — 23.2% |
||||||||
Alarm.com Holdings, Inc. (United States)* |
72,344 | 4,818,110 | ||||||
Everbridge, Inc. (United States)* |
33,566 | 1,335,256 | ||||||
Paylocity Holding Corp. (United States)* |
14,075 | 3,392,075 | ||||||
Ping Identity Holding Corp. (United States)* |
151,404 | 4,260,509 | ||||||
Q2 Holdings, Inc. (United States)(a)* |
44,888 | 1,782,951 | ||||||
Smartsheet, Inc., Class A (United States)* |
52,749 | 1,754,959 | ||||||
Upland Software, Inc. (United States)* |
73,466 | 769,189 | ||||||
18,113,049 | ||||||||
Trading Companies & Distributors — 6.6% |
||||||||
Watsco, Inc. (United States)(a) |
18,848 | 5,127,222 | ||||||
Total Common Stocks (Cost $93,146,756) |
73,033,081 | |||||||
Investments Purchased with Proceeds from Securities Lending Collateral — 21.9% |
||||||||
Mount Vernon Liquid Assets Portfolio, LLC, 2.44% |
17,127,093 | 17,127,093 | ||||||
Total Investments Purchased with Proceeds from Securities Lending Collateral (Cost $17,127,093) |
17,127,093 | |||||||
The accompanying notes are an integral part of these financial statements.
40 |
MOTLEY FOOL Small-Cap Growth ETF
Schedule of Investments (Concluded)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Short-Term Investments — 6.5% |
||||||||
U.S. Bank Money Market Deposit Account, 2.00% (United States)(b) |
5,053,164 | $ | 5,053,164 | |||||
Total Short-Term Investments (Cost $5,053,164) |
5,053,164 | |||||||
Total Investments (Cost $115,327,013) — 122.0% |
95,213,338 | |||||||
Liabilities in Excess of Other Assets — (22.0)% |
(17,163,483 | ) | ||||||
NET ASSETS — 100.0% |
||||||||
(Applicable to 3,100,000 shares outstanding) |
$ | 78,049,855 |
* |
Non-income producing security. |
(a) |
All or a portion of the security is on loan. At August 31, 2022, the market value of securities on loan was $16,722,909. |
(b) |
The rate shown is as of August 31, 2022. |
The accompanying notes are an integral part of these financial statements.
41 |
MOTLEY FOOL CAPITAL EFFICIENCY 100 INDEX ETF
Schedule of Investments
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks — 99.8% |
||||||||
Aerospace & Defense — 0.0% |
||||||||
AeroVironment, Inc. (United States)* |
54 | $ | 4,787 | |||||
Beverages — 0.7% |
||||||||
Boston Beer Co., Inc., (The) (United States)* |
22 | 7,416 | ||||||
Monster Beverage Corp. (United States)* |
1,550 | 137,686 | ||||||
145,102 | ||||||||
Biotechnology — 3.0% |
||||||||
Amgen, Inc. (United States) |
1,499 | 360,210 | ||||||
Biogen, Inc. (United States)* |
402 | 78,543 | ||||||
Exelixis, Inc. (United States)* |
1,026 | 18,201 | ||||||
Vertex Pharmaceuticals, Inc. (United States)* |
621 | 174,973 | ||||||
631,927 | ||||||||
Capital Markets — 0.4% |
||||||||
Nasdaq, Inc. (United States) |
1,215 | 72,329 | ||||||
PJT Partners, Inc., Class A (United States) |
54 | 3,738 | ||||||
76,067 | ||||||||
Chemicals — 0.8% |
||||||||
Balchem Corp. (United States) |
81 | 10,677 | ||||||
Ecolab, Inc. (United States) |
715 | 117,139 | ||||||
RPM International, Inc. (United States) |
373 | 34,749 | ||||||
162,565 | ||||||||
Commercial Services & Supplies — 1.8% |
||||||||
Cintas Corp. (United States) |
288 | 117,170 | ||||||
Copart, Inc. (United States)* |
618 | 73,944 | ||||||
Waste Management, Inc. (United States) |
1,037 | 175,284 | ||||||
366,398 | ||||||||
Communications Equipment — 0.2% |
||||||||
Ubiquiti, Inc. (United States) |
148 | 45,938 | ||||||
Construction & Engineering — 0.1% |
||||||||
MasTec, Inc. (United States)* |
162 | 13,041 | ||||||
Consumer Finance — 0.0% |
||||||||
Upstart Holdings, Inc. (United States)* |
217 | 5,620 |
The accompanying notes are an integral part of these financial statements.
42 |
MOTLEY FOOL CAPITAL EFFICIENCY 100 INDEX ETF
Schedule of Investments (Continued)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks (continued) | ||||||||
Distributors — 0.2% |
||||||||
LKQ Corp. (United States) |
865 | $ | 46,035 | |||||
Electronic Equipment, Instruments & Components — 1.1% |
||||||||
CDW Corp. (United States) |
381 | 65,037 | ||||||
Cognex Corp. (United States) |
409 | 17,223 | ||||||
Corning, Inc. (United States) |
1,999 | 68,605 | ||||||
National Instruments Corp. (United States) |
442 | 17,574 | ||||||
Zebra Technologies Corp., Class A (United States)* |
173 | 52,184 | ||||||
220,623 | ||||||||
Entertainment — 2.2% |
||||||||
Activision Blizzard, Inc. (United States) |
2,037 | 159,884 | ||||||
Netflix, Inc. (United States)* |
1,120 | 250,387 | ||||||
Take-Two Interactive Software, Inc. (United States)* |
426 | 52,211 | ||||||
462,482 | ||||||||
Food & Staples Retailing — 3.3% |
||||||||
Casey’s General Stores, Inc. (United States) |
111 | 23,729 | ||||||
Costco Wholesale Corp. (United States) |
1,261 | 658,368 | ||||||
682,097 | ||||||||
Food Products — 0.1% |
||||||||
Darling Ingredients, Inc. (United States)* |
388 | 29,511 | ||||||
Health Care Equipment & Supplies — 2.3% |
||||||||
ABIOMED, Inc. (United States)* |
111 | 28,780 | ||||||
Globus Medical, Inc., Class A (United States)* |
270 | 15,981 | ||||||
IDEXX Laboratories, Inc. (United States)* |
340 | 118,191 | ||||||
Intuitive Surgical, Inc. (United States)* |
897 | 184,549 | ||||||
Masimo Corp. (United States)* |
134 | 19,683 | ||||||
ResMed, Inc. (United States) |
461 | 101,383 | ||||||
468,567 | ||||||||
Health Care Providers & Services — 6.9% |
||||||||
HCA Healthcare, Inc. (United States) |
916 | 181,249 | ||||||
McKesson Corp. (United States) |
358 | 131,386 | ||||||
UnitedHealth Group, Inc. (United States) |
2,141 | 1,111,886 | ||||||
1,424,521 |
The accompanying notes are an integral part of these financial statements.
43 |
MOTLEY FOOL CAPITAL EFFICIENCY 100 INDEX ETF
Schedule of Investments (Continued)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks (continued) | ||||||||
Health Care Technology — 0.4% |
||||||||
Veeva Systems, Inc., Class A (United States)* |
426 | $ | 84,910 | |||||
Hotels, Restaurants & Leisure — 0.1% |
||||||||
Wingstop, Inc. (United States) |
86 | 9,792 | ||||||
Household Durables — 0.2% |
||||||||
iRobot Corp. (United States)* |
54 | 3,180 | ||||||
Meritage Homes Corp. (United States)* |
93 | 7,287 | ||||||
NVR, Inc. (United States)* |
8 | 33,120 | ||||||
43,587 | ||||||||
Industrial Conglomerates — 0.8% |
||||||||
3M Co. (United States) |
1,405 | 174,712 | ||||||
Interactive Media & Services — 9.5% |
||||||||
Alphabet, Inc., Class C (United States)* |
8,940 | 975,801 | ||||||
Meta Platforms, Inc., Class A (United States)* |
5,902 | 961,613 | ||||||
Pinterest, Inc., Class A (United States)* |
1,636 | 37,693 | ||||||
1,975,107 | ||||||||
Internet & Direct Marketing Retail — 6.0% |
||||||||
Amazon.com, Inc. (United States)* |
9,095 | 1,152,973 | ||||||
eBay, Inc. (United States) |
1,356 | 59,840 | ||||||
Etsy, Inc. (United States)* |
354 | 37,386 | ||||||
1,250,199 | ||||||||
IT Services — 10.5% |
||||||||
Cognizant Technology Solutions Corp., Class A (United States) |
1,559 | 98,482 | ||||||
EPAM Systems, Inc. (United States)* |
158 | 67,387 | ||||||
GoDaddy, Inc., Class A (United States)* |
416 | 31,541 | ||||||
Jack Henry & Associates, Inc. (United States) |
203 | 39,016 | ||||||
Mastercard, Inc., Class A (United States) |
2,862 | 928,347 | ||||||
TaskUS, Inc., Class A (United States)* |
245 | 3,646 | ||||||
Visa, Inc., Class A (United States) |
5,093 | 1,012,030 | ||||||
2,180,449 | ||||||||
Machinery — 0.4% |
||||||||
Cummins, Inc. (United States) |
335 | 72,149 |
The accompanying notes are an integral part of these financial statements.
44 |
MOTLEY FOOL CAPITAL EFFICIENCY 100 INDEX ETF
Schedule of Investments (Continued)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks (continued) | ||||||||
Media — 0.4% |
||||||||
New York Times Co., (The), Class A (United States) |
486 | $ | 14,818 | |||||
Sirius XM Holdings, Inc. (United States) |
11,739 | 71,491 | ||||||
86,309 | ||||||||
Pharmaceuticals — 4.4% |
||||||||
Johnson & Johnson (United States) |
5,711 | 921,413 | ||||||
Professional Services — 0.0% |
||||||||
Upwork, Inc. (United States)* |
311 | 5,411 | ||||||
Road & Rail — 2.2% |
||||||||
Old Dominion Freight Line, Inc. (United States) |
357 | 96,893 | ||||||
Union Pacific Corp. (United States) |
1,595 | 358,094 | ||||||
454,987 | ||||||||
Semiconductors & Semiconductor Equipment — 12.4% |
||||||||
Advanced Micro Devices, Inc. (United States)* |
4,498 | 381,745 | ||||||
Broadcom, Inc. (United States) |
1,060 | 529,057 | ||||||
Cirrus Logic, Inc. (United States)* |
130 | 9,970 | ||||||
Lam Research Corp. (United States) |
422 | 184,798 | ||||||
NVIDIA Corp. (United States) |
5,862 | 884,810 | ||||||
Skyworks Solutions, Inc. (United States) |
372 | 36,661 | ||||||
Texas Instruments, Inc. (United States) |
3,196 | 528,011 | ||||||
Universal Display Corp. (United States) |
108 | 12,067 | ||||||
2,567,119 | ||||||||
Software — 13.7% |
||||||||
Adobe Systems, Inc. (United States)* |
1,644 | 613,935 | ||||||
Appfolio, Inc. (United States)* |
75 | 7,603 | ||||||
Autodesk, Inc. (United States)* |
751 | 151,507 | ||||||
Cadence Design Systems, Inc. (United States)* |
881 | 153,091 | ||||||
Fair Isaac Corp. (United States)* |
97 | 43,592 | ||||||
Fortinet, Inc. (United States)* |
2,423 | 117,976 | ||||||
Microsoft Corp. (United States) |
3,907 | 1,021,563 | ||||||
Paycom Software, Inc. (United States)* |
131 | 46,007 | ||||||
ServiceNow, Inc. (United States)* |
564 | 245,126 | ||||||
Synopsys, Inc. (United States)* |
490 | 169,550 | ||||||
UiPath, Inc., Class A (United States)* |
1,273 | 20,941 | ||||||
VMware, Inc., Class A (United States) |
992 | 115,102 |
The accompanying notes are an integral part of these financial statements.
45 |
MOTLEY FOOL CAPITAL EFFICIENCY 100 INDEX ETF
Schedule of Investments (Continued)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks (continued) | ||||||||
Software (continued) | ||||||||
Workday, Inc., Class A (United States)* |
721 | $ | 118,648 | |||||
Zendesk, Inc. (United States)* |
298 | 22,877 | ||||||
2,847,518 | ||||||||
Specialty Retail — 7.7% |
||||||||
Camping World Holdings, Inc., Class A (United States) |
113 | 3,404 | ||||||
Home Depot, Inc., (The) (United States) |
3,574 | 1,030,813 | ||||||
Lowe’s Cos, Inc. (United States) |
2,252 | 437,203 | ||||||
RH (United States)* |
72 | 18,426 | ||||||
Ulta Beauty, Inc. (United States)* |
154 | 64,660 | ||||||
Williams-Sonoma, Inc. (United States) |
211 | 31,386 | ||||||
Winmark Corp. (United States) |
20 | 4,127 | ||||||
1,590,019 | ||||||||
Technology Hardware, Storage & Peripherals — 5.7% |
||||||||
Apple, Inc. (United States) |
7,345 | 1,154,781 | ||||||
Pure Storage, Inc., Class A (United States)* |
817 | 23,668 | ||||||
1,178,449 | ||||||||
Textiles, Apparel & Luxury Goods — 2.2% |
||||||||
NIKE, Inc., Class B (United States) |
4,152 | 441,980 | ||||||
Under Armour, Inc., Class A (United States)* |
1,404 | 11,822 | ||||||
453,802 | ||||||||
Thrifts & Mortgage Finance — 0.0% |
||||||||
Walker & Dunlop, Inc. (United States) |
72 | 7,233 | ||||||
Trading Companies & Distributors — 0.1% |
||||||||
Watsco, Inc. (United States) |
111 | 30,195 | ||||||
Total Common Stocks (Cost $22,636,269) |
20,718,641 | |||||||
The accompanying notes are an integral part of these financial statements.
46 |
MOTLEY FOOL CAPITAL EFFICIENCY 100 INDEX ETF
Schedule of Investments (Concluded)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Short-Term Investments — 0.1% |
||||||||
U.S. Bank Money Market Deposit Account, 2.00% (United States)(a) |
17,495 | $ | 17,495 | |||||
Total Short-Term Investments (Cost $17,495) |
17,495 | |||||||
Total Investments (Cost $22,653,764) — 99.9% |
20,736,136 | |||||||
Other Assets in Excess of Liabilities — 0.1% |
18,053 | |||||||
NET ASSETS — 100.0% |
||||||||
(Applicable to 1,350,000 shares outstanding) |
$ | 20,754,189 |
* |
Non-income producing security. |
(a) |
The rate shown is as of August 31, 2022. |
The accompanying notes are an integral part of these financial statements.
47 |
MOTLEY FOOL next index ETF
Schedule of Investments
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks — 99.7% |
||||||||
Aerospace & Defense — 2.7% |
||||||||
AeroVironment, Inc. (United States)* |
509 | $ | 45,123 | |||||
Axon Enterprise, Inc. (United States)* |
1,430 | 166,853 | ||||||
HEICO Corp. (United States) |
2,421 | 368,718 | ||||||
Textron, Inc. (United States) |
4,330 | 270,105 | ||||||
Virgin Galactic Holdings, Inc. (United States)* |
5,245 | 30,998 | ||||||
881,797 | ||||||||
Air Freight & Logistics — 0.3% |
||||||||
GXO Logistics, Inc. (United States)* |
2,313 | 102,651 | ||||||
Airlines — 0.5% |
||||||||
Alaska Air Group, Inc. (United States)* |
2,539 | 110,599 | ||||||
Hawaiian Holdings, Inc. (United States)* |
1,044 | 15,649 | ||||||
JetBlue Airways Corp. (United States)* |
6,525 | 50,830 | ||||||
177,078 | ||||||||
Auto Components — 0.6% |
||||||||
BorgWarner, Inc. (United States) |
4,823 | 181,827 | ||||||
Banks — 0.5% |
||||||||
Western Alliance Bancorp (United States) |
2,163 | 165,945 | ||||||
Beverages — 0.3% |
||||||||
Boston Beer Co., Inc., (The) (United States)* |
246 | 82,922 | ||||||
Biotechnology — 6.3% |
||||||||
2seventy bio, Inc. (United States)* |
760 | 11,195 | ||||||
Alnylam Pharmaceuticals, Inc. (United States)* |
2,433 | 502,828 | ||||||
AnaptysBio, Inc. (United States)* |
549 | 12,748 | ||||||
BioMarin Pharmaceutical, Inc. (United States)* |
3,724 | 332,181 | ||||||
Bluebird Bio, Inc. (United States)* |
1,392 | 8,129 | ||||||
Editas Medicine, Inc. (United States)* |
1,392 | 20,462 | ||||||
Emergent BioSolutions, Inc. (United States)* |
1,012 | 24,308 | ||||||
Exact Sciences Corp. (United States)* |
3,542 | 125,918 | ||||||
Exelixis, Inc. (United States)* |
6,457 | 114,547 | ||||||
Ionis Pharmaceuticals, Inc. (United States)* |
2,855 | 121,395 | ||||||
Neurocrine Biosciences, Inc. (United States)* |
1,924 | 201,308 | ||||||
Seagen, Inc. (United States)* |
3,720 | 573,959 | ||||||
2,048,978 |
The accompanying notes are an integral part of these financial statements.
48 |
MOTLEY FOOL next index ETF
Schedule of Investments (Continued)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks (continued) | ||||||||
Building Products — 0.3% |
||||||||
Trex Co., Inc. (United States)* |
2,280 | $ | 106,681 | |||||
Capital Markets — 5.4% |
||||||||
Affiliated Managers Group, Inc. (United States) |
779 | 99,214 | ||||||
Cboe Global Markets, Inc. (United States) |
2,139 | 252,338 | ||||||
FactSet Research Systems, Inc. (United States) |
763 | 330,638 | ||||||
Interactive Brokers Group, Inc., Class A (United States) |
1,979 | 121,887 | ||||||
Jefferies Financial Group, Inc. (United States) |
4,822 | 154,738 | ||||||
MarketAxess Holdings, Inc. (United States) |
760 | 188,928 | ||||||
Nasdaq, Inc. (United States) |
9,948 | 592,204 | ||||||
PJT Partners, Inc., Class A (United States) |
473 | 32,741 | ||||||
1,772,688 | ||||||||
Chemicals — 1.0% |
||||||||
Balchem Corp. (United States) |
647 | 85,288 | ||||||
RPM International, Inc. (United States) |
2,607 | 242,868 | ||||||
328,156 | ||||||||
Commercial Services & Supplies — 1.0% |
||||||||
Rollins, Inc. (United States) |
9,915 | 334,730 | ||||||
Communications Equipment — 3.4% |
||||||||
Arista Networks, Inc. (United States)* |
6,206 | 743,975 | ||||||
Ubiquiti, Inc. (United States) |
1,217 | 377,745 | ||||||
1,121,720 | ||||||||
Construction & Engineering — 0.5% |
||||||||
MasTec, Inc. (United States)* |
1,494 | 120,267 | ||||||
NV5 Global, Inc. (United States)* |
318 | 44,762 | ||||||
165,029 | ||||||||
Consumer Finance — 0.1% |
||||||||
Upstart Holdings, Inc. (United States)* |
1,733 | 44,885 | ||||||
Distributors — 0.9% |
||||||||
LKQ Corp. (United States) |
5,694 | 303,035 | ||||||
Diversified Consumer Services — 0.2% |
||||||||
2U, Inc. (United States)* |
1,524 | 10,851 |
The accompanying notes are an integral part of these financial statements.
49 |
MOTLEY FOOL next index ETF
Schedule of Investments (Continued)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks (continued) | ||||||||
Diversified Consumer Services (continued) | ||||||||
Chegg, Inc. (United States)* |
2,535 | $ | 49,889 | |||||
60,740 | ||||||||
Diversified Telecommunication Services — 0.0% |
||||||||
Bandwidth, Inc., Class A (United States)* |
522 | 8,091 | ||||||
Electronic Equipment, Instruments & Components — 6.0% |
||||||||
CDW Corp. (United States) |
2,731 | 466,182 | ||||||
Cognex Corp. (United States) |
3,498 | 147,301 | ||||||
Corning, Inc. (United States) |
17,004 | 583,577 | ||||||
II-VI, Inc. (United States)* |
2,599 | 122,751 | ||||||
IPG Photonics Corp. (United States)* |
1,045 | 94,667 | ||||||
Littelfuse, Inc. (United States) |
502 | 119,084 | ||||||
National Instruments Corp. (United States) |
2,641 | 105,006 | ||||||
Zebra Technologies Corp., Class A (United States)* |
1,058 | 319,135 | ||||||
1,957,703 | ||||||||
Energy Equipment & Services — 0.1% |
||||||||
Oceaneering International, Inc. (United States)* |
2,001 | 17,709 | ||||||
Entertainment — 5.4% |
||||||||
Live Nation Entertainment, Inc. (United States)* |
4,579 | 413,758 | ||||||
Roku, Inc. (United States)* |
2,738 | 186,184 | ||||||
Skillz, Inc. (United States)* |
8,439 | 11,224 | ||||||
Take-Two Interactive Software, Inc. (United States)* |
3,150 | 386,064 | ||||||
Warner Bros Discovery, Inc. (United States)* |
49,044 | 649,343 | ||||||
World Wrestling Entertainment, Inc., Class A (United States) |
1,503 | 102,219 | ||||||
1,748,792 | ||||||||
Equity Real Estate Investment Trusts (REITs) — 0.5% |
||||||||
Retail Opportunity Investments Corp. (United States) |
2,477 | 41,490 | ||||||
STAG Industrial, Inc. (United States) |
3,608 | 111,126 | ||||||
152,616 | ||||||||
Food & Staples Retailing — 0.5% |
||||||||
Casey’s General Stores, Inc. (United States) |
747 | 159,686 | ||||||
Food Products — 2.4% |
||||||||
Beyond Meat, Inc. (United States)* |
1,305 | 31,842 | ||||||
Darling Ingredients, Inc. (United States)* |
3,252 | 247,347 |
The accompanying notes are an integral part of these financial statements.
50 |
MOTLEY FOOL next index ETF
Schedule of Investments (Continued)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks (continued) | ||||||||
Food Products (continued) | ||||||||
Freshpet, Inc. (United States)* |
966 | $ | 42,050 | |||||
McCormick & Co., Inc. (United States) |
5,443 | 457,593 | ||||||
778,832 | ||||||||
Health Care Equipment & Supplies — 4.1% |
||||||||
ABIOMED, Inc. (United States)* |
917 | 237,760 | ||||||
Globus Medical, Inc., Class A (United States)* |
2,049 | 121,280 | ||||||
Insulet Corp. (United States)* |
1,396 | 356,636 | ||||||
Masimo Corp. (United States)* |
1,118 | 164,223 | ||||||
NuVasive, Inc. (United States)* |
1,058 | 44,976 | ||||||
QuidelOrtho Corp. (United States)* |
1,352 | 107,160 | ||||||
Shockwave Medical, Inc. (United States)* |
721 | 214,036 | ||||||
STAAR Surgical Co. (United States)* |
972 | 91,941 | ||||||
1,338,012 | ||||||||
Health Care Providers & Services — 0.7% |
||||||||
Fulgent Genetics, Inc. (United States)* |
609 | 26,473 | ||||||
Guardant Health, Inc. (United States)* |
2,053 | 102,773 | ||||||
HealthEquity, Inc. (United States)* |
1,695 | 112,006 | ||||||
241,252 | ||||||||
Health Care Technology — 0.9% |
||||||||
Doximity, Inc., Class A (United States)* |
3,895 | 129,275 | ||||||
GoodRx Holdings, Inc., Class A (United States)* |
7,982 | 48,690 | ||||||
Teladoc Health, Inc. (United States)* |
3,246 | 100,821 | ||||||
278,786 | ||||||||
Hotels, Restaurants & Leisure — 2.2% |
||||||||
Dave & Buster’s Entertainment, Inc. (United States)* |
982 | 40,596 | ||||||
Hyatt Hotels Corp., Class A (United States)* |
2,221 | 199,046 | ||||||
Planet Fitness, Inc., Class A (United States)* |
1,710 | 115,853 | ||||||
Texas Roadhouse, Inc. (United States) |
1,373 | 121,867 | ||||||
Vail Resorts, Inc. (United States) |
811 | 182,215 | ||||||
Wingstop, Inc. (United States) |
613 | 69,796 | ||||||
729,373 | ||||||||
Household Durables — 1.2% |
||||||||
Dream Finders Homes, Inc. (United States)* |
1,915 | 23,650 | ||||||
iRobot Corp. (United States)* |
542 | 31,913 |
The accompanying notes are an integral part of these financial statements.
51 |
MOTLEY FOOL next index ETF
Schedule of Investments (Continued)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks (continued) | ||||||||
Household Durables (continued) | ||||||||
Meritage Homes Corp. (United States)* |
739 | $ | 57,901 | |||||
NVR, Inc. (United States)* |
67 | 277,384 | ||||||
390,848 | ||||||||
Household Products — 0.2% |
||||||||
Spectrum Brands Holdings, Inc. (United States) |
821 | 51,715 | ||||||
Insurance — 1.7% |
||||||||
Kinsale Capital Group, Inc. (United States) |
462 | 117,154 | ||||||
Lemonade, Inc. (United States)* |
1,249 | 27,628 | ||||||
Markel Corp. (United States)* |
274 | 327,186 | ||||||
Safety Insurance Group, Inc. (United States) |
289 | 26,025 | ||||||
Trupanion, Inc. (United States)* |
835 | 58,934 | ||||||
556,927 | ||||||||
Interactive Media & Services — 1.2% |
||||||||
Bumble, Inc., Class A (United States)* |
2,608 | 65,330 | ||||||
Eventbrite, Inc., Class A (United States)* |
1,914 | 13,609 | ||||||
fuboTV, Inc. (United States)* |
3,045 | 11,023 | ||||||
Pinterest, Inc., Class A (United States)* |
13,357 | 307,745 | ||||||
397,707 | ||||||||
Internet & Direct Marketing Retail — 2.1% |
||||||||
Chewy, Inc., Class A (United States)* |
8,468 | 290,707 | ||||||
Etsy, Inc. (United States)* |
2,559 | 270,256 | ||||||
Stitch Fix, Inc., Class A (United States)* |
2,216 | 11,124 | ||||||
Wayfair, Inc., Class A (United States)* |
2,120 | 111,745 | ||||||
683,832 | ||||||||
IT Services — 11.6% |
||||||||
Broadridge Financial Solutions, Inc. (United States) |
2,361 | 404,132 | ||||||
Cloudflare, Inc., Class A (United States)* |
6,593 | 412,524 | ||||||
DigitalOcean Holdings, Inc. (United States)* |
2,056 | 86,537 | ||||||
EPAM Systems, Inc. (United States)* |
1,151 | 490,901 | ||||||
Euronet Worldwide, Inc. (United States)* |
1,019 | 90,345 | ||||||
Fastly, Inc., Class A (United States)* |
2,436 | 22,777 | ||||||
Gartner, Inc. (United States)* |
1,622 | 462,789 | ||||||
GoDaddy, Inc., Class A (United States)* |
3,257 | 246,946 | ||||||
SS&C Technologies Holdings, Inc. (United States) |
5,130 | 286,049 |
The accompanying notes are an integral part of these financial statements.
52 |
MOTLEY FOOL next index ETF
Schedule of Investments (Continued)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks (continued) | ||||||||
IT Services (continued) | ||||||||
Jack Henry & Associates, Inc. (United States) |
1,467 | $ | 281,957 | |||||
Marqeta, Inc., Class A (United States)* |
11,003 | 85,713 | ||||||
MongoDB, Inc. (United States)* |
1,372 | 442,964 | ||||||
Okta, Inc. (United States)* |
3,189 | 291,475 | ||||||
TaskUS, Inc., Class A (United States)* |
2,001 | 29,775 | ||||||
WEX, Inc. (United States)* |
906 | 139,750 | ||||||
3,774,634 | ||||||||
Leisure Products — 0.9% |
||||||||
Hasbro, Inc. (United States) |
2,807 | 221,248 | ||||||
Peloton Interactive, Inc., Class A (United States)* |
6,786 | 69,149 | ||||||
290,397 | ||||||||
Life Sciences Tools & Services — 0.7% |
||||||||
Repligen Corp. (United States)* |
1,117 | 245,036 | ||||||
Machinery — 4.4% |
||||||||
Chart Industries, Inc. (United States)* |
722 | 139,967 | ||||||
Cummins, Inc. (United States) |
2,841 | 611,866 | ||||||
Middleby Corp., (The) (United States)* |
1,096 | 157,627 | ||||||
Proto Labs, Inc. (United States)* |
549 | 21,082 | ||||||
Tennant Co. (United States) |
368 | 22,209 | ||||||
Toro Co. (The) (United States) |
2,106 | 174,650 | ||||||
Westinghouse Air Brake Technologies Corp. (United States) |
3,677 | 322,289 | ||||||
1,449,690 | ||||||||
Media — 1.9% |
||||||||
Boston Omaha Corp., Class A (United States)* |
609 | 16,340 | ||||||
Magnite, Inc. (United States)* |
2,697 | 20,308 | ||||||
New York Times Co., (The), Class A (United States) |
3,372 | 102,812 | ||||||
Sirius XM Holdings, Inc. (United States) |
79,240 | 482,572 | ||||||
622,032 | ||||||||
Oil, Gas & Consumable Fuels — 0.1% |
||||||||
Clean Energy Fuels Corp. (United States)* |
4,611 | 30,986 | ||||||
Pharmaceuticals — 0.7% |
||||||||
Viatris, Inc. (United States) |
24,407 | 233,087 |
The accompanying notes are an integral part of these financial statements.
53 |
MOTLEY FOOL next index ETF
Schedule of Investments (Continued)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks (continued) | ||||||||
Professional Services — 0.7% |
||||||||
Robert Half International, Inc. (United States) |
2,190 | $ | 168,564 | |||||
Upwork, Inc. (United States)* |
2,610 | 45,414 | ||||||
213,978 | ||||||||
Real Estate Management & Development — 0.6% |
||||||||
Redfin Corp. (United States)* |
2,175 | 17,813 | ||||||
Zillow Group, Inc., Class C (United States)* |
4,979 | 166,598 | ||||||
184,411 | ||||||||
Road & Rail — 1.0% |
||||||||
AMERCO (United States) |
395 | 207,639 | ||||||
XPO Logistics, Inc. (United States)* |
2,316 | 121,405 | ||||||
329,044 | ||||||||
Semiconductors & Semiconductor Equipment — 2.8% |
||||||||
Cirrus Logic, Inc. (United States)* |
1,126 | 86,353 | ||||||
First Solar, Inc. (United States)* |
2,146 | 273,722 | ||||||
Impinj, Inc. (United States)* |
509 | 45,444 | ||||||
Silicon Laboratories, Inc. (United States)* |
737 | 92,368 | ||||||
Skyworks Solutions, Inc. (United States) |
3,240 | 319,302 | ||||||
Universal Display Corp. (United States) |
951 | 106,255 | ||||||
923,444 | ||||||||
Software — 13.1% |
||||||||
Alarm.com Holdings, Inc. (United States)* |
1,009 | 67,199 | ||||||
Alteryx, Inc., Class A (United States)* |
1,392 | 86,749 | ||||||
Appfolio, Inc., Class A (United States)* |
708 | 71,777 | ||||||
Appian Corp. (United States)* |
1,457 | 68,333 | ||||||
Asana, Inc., Class A (United States)* |
3,830 | 73,345 | ||||||
Avalara, Inc. (United States)* |
1,769 | 162,023 | ||||||
Blackbaud, Inc. (United States)* |
1,048 | 54,810 | ||||||
Blackline, Inc. (United States)* |
1,195 | 81,188 | ||||||
Cerence, Inc. (United States)* |
783 | 15,668 | ||||||
Confluent, Inc., Class A (United States)* |
5,632 | 154,092 | ||||||
Coupa Software, Inc. (United States)* |
1,535 | 89,644 | ||||||
DocuSign, Inc. (United States)* |
4,041 | 235,267 | ||||||
Fair Isaac Corp. (United States)* |
523 | 235,036 | ||||||
Five9, Inc. (United States)* |
1,401 | 137,452 |
The accompanying notes are an integral part of these financial statements.
54 |
MOTLEY FOOL next index ETF
Schedule of Investments (Continued)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks (continued) | ||||||||
Software (continued) | ||||||||
HubSpot, Inc. (United States)* |
962 | $ | 324,232 | |||||
LivePerson, Inc. (United States)* |
1,479 | 17,156 | ||||||
New Relic, Inc. (United States)* |
1,364 | 82,808 | ||||||
Nutanix, Inc., Class A (United States)* |
4,552 | 78,750 | ||||||
PagerDuty, Inc. (United States)* |
1,761 | 45,856 | ||||||
Paycom Software, Inc. (United States)* |
1,169 | 410,553 | ||||||
Pegasystems, Inc. (United States) |
1,647 | 60,297 | ||||||
Q2 Holdings, Inc. (United States)* |
1,155 | 45,877 | ||||||
Smartsheet, Inc., Class A (United States)* |
2,610 | 86,835 | ||||||
Splunk, Inc. (United States)* |
3,241 | 291,787 | ||||||
Trade Desk, Inc., (The), Class A (United States)* |
9,791 | 613,896 | ||||||
UiPath, Inc., Class A (United States)* |
11,009 | 181,098 | ||||||
Unity Software, Inc. (United States)* |
5,982 | 255,551 | ||||||
Varonis Systems, Inc. (United States)* |
2,199 | 60,143 | ||||||
Zendesk, Inc. (United States)* |
2,467 | 189,392 | ||||||
Zuora, Inc., Class A (United States)* |
2,610 | 20,045 | ||||||
4,296,859 | ||||||||
Specialty Retail — 5.7% |
||||||||
Camping World Holdings, Inc., Class A (United States) |
839 | 25,271 | ||||||
CarMax, Inc. (United States)* |
3,225 | 285,219 | ||||||
Designer Brands, Inc., Class A (United States) |
1,479 | 25,232 | ||||||
Five Below, Inc. (United States)* |
1,118 | 142,970 | ||||||
GameStop Corp., Class A (United States)* |
6,100 | 174,704 | ||||||
RH (United States)* |
499 | 127,699 | ||||||
Sleep Number Corp. (United States)* |
454 | 18,809 | ||||||
Tractor Supply Co. (United States) |
2,253 | 417,143 | ||||||
Ulta Beauty, Inc. (United States)* |
1,044 | 438,344 | ||||||
Williams-Sonoma, Inc. (United States) |
1,385 | 206,019 | ||||||
Winmark Corp. (United States) |
71 | 14,652 | ||||||
1,876,062 | ||||||||
Technology Hardware, Storage & Peripherals — 0.5% |
||||||||
Pure Storage, Inc., Class A (United States)* |
5,960 | 172,661 | ||||||
Textiles, Apparel & Luxury Goods — 0.8% |
||||||||
Carter’s, Inc. (United States) |
811 | 59,892 | ||||||
Skechers USA, Inc., Class A (United States)* |
3,137 | 118,579 |
The accompanying notes are an integral part of these financial statements.
55 |
MOTLEY FOOL next index ETF
Schedule of Investments (Concluded)
AUGUST 31, 2022
|
Number
of |
Value |
||||||
Common Stocks (continued) | ||||||||
Textiles, Apparel & Luxury Goods (continued) | ||||||||
Under Armour, Inc., Class A (United States)* |
8,885 | $ | 74,812 | |||||
253,283 | ||||||||
Thrifts & Mortgage Finance — 0.4% |
||||||||
Axos Financial, Inc. (United States)* |
1,218 | 50,888 | ||||||
Walker & Dunlop, Inc. (United States) |
667 | 67,007 | ||||||
117,895 | ||||||||
Trading Companies & Distributors — 0.6% |
||||||||
Watsco, Inc. (United States) |
719 | 195,589 | ||||||
Total Common Stocks (Cost $38,781,975) |
32,579,831 | |||||||
Short-Term Investments — 0.3% |
||||||||
U.S. Bank Money Market Deposit Account, 2.00% (United States)(a) |
85,879 | 85,879 | ||||||
Total Short-Term Investments (Cost $85,879) |
85,879 | |||||||
Total Investments (Cost $38,867,854) — 100.0% |
32,665,710 | |||||||
Other Assets in Excess of Liabilities — 0.0% |
12,267 | |||||||
NET ASSETS — 100.0% |
||||||||
(Applicable to 2,175,000 shares outstanding) |
$ | 32,677,977 |
* |
Non-income producing security. |
(a) |
The rate shown is as of August 31, 2022. |
The accompanying notes are an integral part of these financial statements.
56 |
Motley Fool ETFs
Statements of Assets and Liabilities
AUGUST 31, 2022
|
Motley
|
Motley
Fool |
Motley
|
Motley
Fool |
||||||||||||
ASSETS |
||||||||||||||||
Investments in securities of unaffiliated issurers, at value (cost $256,755,317, $110,089,287, $321,469,432 and $93,146,756 respectively)^ |
$ | 423,553,509 | $ | 196,123,527 | $ | 416,689,077 | $ | 73,033,081 | ||||||||
Investments purchased with proceeds from securities lending collateral (cost $33,805,832, $31,234,388, $21,230,044 and $17,127,093 respectively) |
33,805,832 | 31,234,388 | 21,230,044 | 17,127,093 | ||||||||||||
Short-term investments, at value (cost $9,326,426, $13,654,888, $387,749 and $5,053,164 respectively) |
9,326,426 | 13,654,888 | 387,749 | 5,053,164 | ||||||||||||
Foreign currency, at value (cost $21,232, $—, $— and $—, respectively) |
21,214 | — | — | — | ||||||||||||
Receivables for: |
||||||||||||||||
Dividends and tax reclaims |
1,157,542 | 103,250 | 381,664 | 23,708 | ||||||||||||
Investments sold |
1,170,011 | 408,541 | — | — | ||||||||||||
Total assets |
469,034,534 | 241,524,594 | 438,688,534 | 95,237,046 | ||||||||||||
LIABILITIES |
||||||||||||||||
Payables for: |
||||||||||||||||
Securities lending collateral (see Note 7) |
33,805,832 | 31,234,388 | 21,230,044 | 17,127,093 | ||||||||||||
Advisory fees |
332,054 | 206,979 | 189,753 | 60,098 | ||||||||||||
Shares of beneficial interest redeemed |
1,244,605 | — | — | — | ||||||||||||
Investments purchased |
— | 1,039,212 | — | — | ||||||||||||
Total liabilities |
35,382,491 | 32,480,579 | 21,419,797 | 17,187,191 | ||||||||||||
Net assets |
$ | 433,652,043 | $ | 209,044,015 | $ | 417,268,737 | $ | 78,049,855 | ||||||||
NET ASSETS CONSIST OF: |
||||||||||||||||
Par value |
$ | 17,519 | $ | 9,218 | $ | 12,275 | $ | 3,100 | ||||||||
Paid-in capital |
266,636,862 | 123,598,018 | 331,733,639 | 99,509,170 | ||||||||||||
Total distributable earnings/(losses) |
166,997,662 | 85,436,779 | 85,522,823 | (21,462,415 | ) | |||||||||||
Net assets |
$ | 433,652,043 | $ | 209,044,015 | $ | 417,268,737 | $ | 78,049,855 | ||||||||
Shares outstanding ($0.001 par value, 100,000,000 shares authorized) |
17,518,873 | 9,217,511 | 12,275,000 | 3,100,000 | ||||||||||||
Net asset value, price per share |
$ | 24.75 | $ | 22.68 | $ | 33.99 | $ | 25.18 | ||||||||
^ Includes market value of securities on loan |
$ | 32,824,775 | $ | 30,222,704 | $ | 20,543,351 | $ | 16,722,909 |
The accompanying notes are an integral part of these financial statements.
57 |
Motley Fool ETFs
Statements of Assets and Liabilities (concluded)
AUGUST 31, 2022
|
Motley
Fool |
Motley
|
||||||
ASSETS |
||||||||
Investments in securities of unaffiliated issuers, at value (cost $22,636,269 and $38,781,975 respectively) |
$ | 20,718,641 | $ | 32,579,831 | ||||
Short-term investments, at value (cost $17,495 and $85,879 respectively) |
17,495 | 85,879 | ||||||
Receivables for: |
||||||||
Dividends and tax reclaims |
27,503 | 26,997 | ||||||
Total assets |
20,763,639 | 32,692,707 | ||||||
LIABILITIES |
||||||||
Payables for: |
||||||||
Advisory fees |
9,450 | 14,730 | ||||||
Total liabilities |
9,450 | 14,730 | ||||||
Net assets |
$ | 20,754,189 | $ | 32,677,977 | ||||
NET ASSETS CONSIST OF: |
||||||||
Par value |
$ | 1,350 | $ | 2,175 | ||||
Paid-in capital |
22,929,059 | 39,076,875 | ||||||
Total distributable earnings/(losses) |
(2,176,220 | ) | (6,401,073 | ) | ||||
Net assets |
$ | 20,754,189 | $ | 32,677,977 | ||||
Shares outstanding ($0.001 par value, 100,000,000 shares authorized) |
1,350,000 | 2,175,000 | ||||||
Net asset value, price per share |
$ | 15.37 | $ | 15.02 |
The accompanying notes are an integral part of these financial statements.
58 |
Motley Fool ETFs
Statements of Operations
FOR THE YEAR ENDED AUGUST 31, 2022
|
Motley
|
Motley
Fool |
Motley
|
Motley
Fool |
||||||||||||
INVESTMENT INCOME |
||||||||||||||||
Dividends |
$ | 21,490,156 | $ | 1,784,857 | $ | 3,419,229 | $ | 455,293 | ||||||||
Less foreign taxes withheld |
(2,682,775 | ) | — | — | — | |||||||||||
Securities lending income |
450,755 | 39,668 | 43,353 | 34,085 | ||||||||||||
Total investment income |
19,258,136 | 1,824,525 | 3,462,582 | 489,378 | ||||||||||||
EXPENSES |
||||||||||||||||
Advisory fees (Note 3) |
4,720,440 | 2,259,426 | 2,481,677 | 1,060,744 | ||||||||||||
Shareholder service fees |
121,437 | 38,618 | — | — | ||||||||||||
Transfer agent fees and shareholder account services |
62,923 | 40,251 | — | — | ||||||||||||
Administration and accounting services fees |
35,500 | 16,574 | — | — | ||||||||||||
Registration and filing fees |
30,961 | 26,936 | — | — | ||||||||||||
Legal fees |
27,787 | 12,996 | — | — | ||||||||||||
Officer fees |
25,036 | 11,851 | — | — | ||||||||||||
Director fees |
23,717 | 10,344 | — | — | ||||||||||||
Printing and shareholder reporting fees |
9,275 | 4,381 | — | — | ||||||||||||
Custodian fees |
6,842 | 689 | — | — | ||||||||||||
Other expenses |
40,268 | 37,276 | — | — | ||||||||||||
Total expenses |
5,104,186 | 2,459,342 | 2,481,677 | 1,060,744 | ||||||||||||
Expense fees waived/reimbursed net of amount recaptured |
(9,581 | ) | 26,071 | — | — | |||||||||||
Net expenses after waivers/reimbursements |
5,094,605 | 2,485,413 | 2,481,677 | 1,060,744 | ||||||||||||
Net investment income/(loss) |
14,163,531 | (660,888 | ) | 980,905 | (571,366 | ) | ||||||||||
NET REALIZED AND UNREALIZED GAIN/(LOSS) FROM INVESTMENTS |
||||||||||||||||
Net realized gain/(loss) from: |
||||||||||||||||
Investments |
2,427,919 | 2,301,137 | (8,300,879 | ) | (1,123,147 | ) | ||||||||||
Foreign currency transactions |
(11,591 | ) | — | — | — | |||||||||||
Redemption in-kind |
26,577,730 | 14,461,455 | 20,465,901 | 13,282,778 | ||||||||||||
Net change in unrealized appreciation/(depreciation) on: |
||||||||||||||||
Investments |
(227,584,440 | ) | (100,048,288 | ) | (120,161,259 | ) | (70,725,754 | ) | ||||||||
Foreign currency transactions |
(138,046 | ) | — | — | — | |||||||||||
Net realized and unrealized gain/(loss) |
(198,728,428 | ) | (83,285,696 | ) | (107,996,237 | ) | (58,566,123 | ) | ||||||||
Net increase/(decrease) in net assets resulting from operations |
$ | (184,564,897 | ) | $ | (83,946,584 | ) | $ | (107,015,332 | ) | $ | (59,137,489 | ) |
The accompanying notes are an integral part of these financial statements.
59 |
Motley Fool ETFs
Statements of Operations (CONCLUDED)
FOR THE YEAR ENDED AUGUST 31, 2022
|
Motley
Fool |
Motley |
||||||
INVESTMENT INCOME |
||||||||
Dividends |
$ | 85,592 | $ | 150,268 | ||||
Total investment income |
85,592 | 150,268 | ||||||
EXPENSES |
||||||||
Advisory fees (Note 3) |
42,809 | 99,316 | ||||||
Total expenses |
42,809 | 99,316 | ||||||
Net investment income/(loss) |
42,783 | 50,952 | ||||||
NET REALIZED AND UNREALIZED GAIN/(LOSS) FROM INVESTMENTS |
||||||||
Net realized gain/(loss) from: |
||||||||
Investments |
(336,104 | ) | (250,007 | ) | ||||
Redemption in-kind |
(33,665 | ) | (18,804 | ) | ||||
Net change in unrealized appreciation/(depreciation) on: |
||||||||
Investments |
(1,917,628 | ) | (6,202,144 | ) | ||||
Net realized and unrealized gain/(loss) |
(2,287,397 | ) | (6,470,955 | ) | ||||
Net increase/(decrease) in net assets resulting from operations |
$ | (2,244,614 | ) | $ | (6,420,003 | ) |
The accompanying notes are an integral part of these financial statements.
60 |
MOTLEY
FOOL Global Opportunities ETF
Statements of Changes in Net Assets
|
FOR
THE |
FOR
THE |
||||||
OPERATIONS |
||||||||
Net investment income/(loss) |
$ | 14,163,531 | $ | (1,529,228 | ) | |||
Net realized gain/(loss) from investments and foreign currency transactions |
28,994,058 | 40,352,385 | ||||||
Net change in unrealized appreciation/(depreciation) on investments, foreign currency translation and assets and liabilities denominated in foreign currencies |
(227,722,486 | ) | 127,446,258 | |||||
Net increase/(decrease) in net assets resulting from operations |
(184,564,897 | ) | 166,269,415 | |||||
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS: |
||||||||
Investor Shares |
(35,341,409 | ) | (29,627,168 | ) | ||||
Institutional Shares |
(12,707,670 | ) | (8,731,295 | ) | ||||
Total dividends and distributions to shareholders |
(48,049,079 | ) | (38,358,463 | ) | ||||
CAPITAL SHARE TRANSACTIONS: |
||||||||
Investor Shares |
||||||||
Proceeds from shares sold |
6,643,104 | 38,245,067 | ||||||
Reinvestment of dividends |
34,321,026 | 28,940,492 | ||||||
Shares redeemed |
(21,570,991 | ) | (70,627,638 | ) | ||||
Shares redeemed from exchange to Institutional Class(1) |
(458,343,422 | ) | — | |||||
Total from Investor Shares |
(438,950,283 | ) | (3,442,079 | ) | ||||
Institutional Shares |
||||||||
Proceeds from shares sold |
6,411,019 | 26,065,853 | ||||||
Proceeds from Institutional Class exchange(1) |
458,343,422 | — | ||||||
Reinvestment of dividends |
12,058,120 | 8,440,970 | ||||||
Shares redeemed |
(73,170,311 | ) | (7,360,393 | ) | ||||
Total from Institutional Shares |
403,642,250 | 27,146,430 | ||||||
Net increase/(decrease) in net assets from capital share transactions |
(35,308,033 | ) | 23,704,351 | |||||
Total increase/(decrease) in net assets |
(267,922,009 | ) | 151,615,303 | |||||
NET ASSETS: |
||||||||
Beginning of period |
$ | 701,574,052 | $ | 549,958,749 | ||||
End of period |
$ | 433,652,043 | $ | 701,574,052 |
(1) |
Effective December 3, 2021, the outstanding Investor Class Shares of the Fund were converted into Institutional Class Shares of the Fund. |
The accompanying notes are an integral part of these financial statements.
61 |
MOTLEY
FOOL Global Opportunities ETF
Statements of Changes in Net Assets
(CONCLUDED)
|
FOR
THE |
FOR
THE |
||||||
SHARE TRANSACTIONS: |
||||||||
Investor Shares |
||||||||
Shares sold |
187,055 | 1,169,191 | ||||||
Shares reinvested |
1,111,072 | 908,079 | ||||||
Shares redeemed |
(612,521 | ) | (2,183,641 | ) | ||||
Shares exchanged into Institutional Class(1) |
(14,816,530 | ) | — | |||||
Net increase/(decrease) in shares |
(14,130,924 | ) | (106,371 | ) | ||||
Institutional Shares |
||||||||
Shares sold |
179,722 | 806,765 | ||||||
Shares exchanged from Investor Class(1) |
14,718,418 | — | ||||||
Shares reinvested |
387,721 | 263,533 | ||||||
Shares redeemed |
(2,668,501 | ) | (225,516 | ) | ||||
Net increase/(decrease) in shares |
12,617,360 | 844,782 |
(1) |
Effective December 3, 2021, the outstanding Investor Class Shares of the Fund were converted into Institutional Class Shares of the Fund. |
The accompanying notes are an integral part of these financial statements.
62 |
MOTLEY
FOOL Mid-Cap Growth ETF
Statements of Changes in Net Assets
|
FOR
THE |
FOR
THE |
||||||
OPERATIONS |
||||||||
Net investment income/(loss) |
$ | (660,888 | ) | $ | (1,276,392 | ) | ||
Net realized gain/(loss) from investments and foreign currency transactions |
16,762,592 | 27,656,516 | ||||||
Net change in unrealized appreciation/(depreciation) on investments, foreign currency translation, and assets and liabilities denominated in foreign currencies |
(100,048,288 | ) | 41,096,995 | |||||
Net increase/(decrease) in net assets resulting from operations |
(83,946,584 | ) | 67,477,119 | |||||
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS: |
||||||||
Investor Shares |
(3,423,164 | ) | (28,230,758 | ) | ||||
Institutional Shares |
(17,390,769 | ) | (4,600,549 | ) | ||||
Total dividends and distributions to shareholders |
(20,813,933 | ) | (32,831,307 | ) | ||||
CAPITAL SHARE TRANSACTIONS: |
||||||||
Investor Shares |
||||||||
Proceeds from shares sold |
3,029,266 | 13,864,720 | ||||||
Reinvestment of dividends |
16,920,328 | 27,593,542 | ||||||
Shares redeemed |
(10,054,968 | ) | (44,985,080 | ) | ||||
Shares redeemed from exchange to Institutional Class(1) |
(250,730,153 | ) | — | |||||
Total from Investor Shares |
(240,835,531 | ) | (3,526,818 | ) | ||||
Institutional Shares |
||||||||
Proceeds from shares sold |
1,532,940 | 7,535,394 | ||||||
Proceeds from Institutional Class exchange(1) |
250,730,153 | — | ||||||
Reinvestment of dividends |
3,235,692 | 4,435,828 | ||||||
Shares redeemed |
(32,143,643 | ) | (2,493,650 | ) | ||||
Total from Institutional Shares |
223,355,142 | 9,477,572 | ||||||
Net increase/(decrease) in net assets from capital share transactions |
(17,480,385 | ) | 5,950,754 | |||||
Total increase/(decrease) in net assets |
(122,240,902 | ) | 40,596,566 | |||||
NET ASSETS: |
||||||||
Beginning of period |
$ | 331,284,917 | $ | 290,688,351 | ||||
End of period |
$ | 209,044,015 | $ | 331,284,917 |
(1) |
Effective December 3, 2021, the outstanding Investor Class Shares of the Fund were converted into Institutional Class Shares of the Fund. |
The accompanying notes are an integral part of these financial statements.
63 |
MOTLEY
FOOL Mid-Cap Growth ETF
Statements of Changes in Net Assets
(CONCLUDED)
|
FOR
THE |
FOR
THE |
||||||
SHARE TRANSACTIONS: |
||||||||
Investor Shares |
||||||||
Shares sold |
95,439 | 457,162 | ||||||
Shares reinvested |
601,505 | 952,158 | ||||||
Shares redeemed |
(316,334 | ) | (1,484,062 | ) | ||||
Shares exchanged into Institutional Class(1) |
(8,829,770 | ) | — | |||||
Net increase/(decrease) in shares |
(8,449,160 | ) | (74,742 | ) | ||||
Institutional Shares |
||||||||
Shares sold |
47,461 | 243,287 | ||||||
Shares exchanged from Investor Class(1) |
8,699,588 | — | ||||||
Shares reinvested |
113,334 | 151,238 | ||||||
Shares redeemed |
(1,283,081 | ) | (80,018 | ) | ||||
Net increase/(decrease) in shares |
7,577,302 | 314,507 |
(1) |
Effective December 3, 2021, the outstanding Investor Class Shares of the Fund were converted into Institutional Class Shares of the Fund. |
The accompanying notes are an integral part of these financial statements.
64 |
Motley Fool 100 Index ETF
Statements of Changes in Net Assets
|
FOR
THE |
FOR
THE |
||||||
INCREASE/(DECREASE) IN NET ASSETS FROM OPERATIONS: |
||||||||
Net investment income/(loss) |
$ | 980,905 | $ | 608,321 | ||||
Net realized gain/(loss) from investments |
12,165,022 | 3,950,823 | ||||||
Net change in unrealized appreciation/(depreciation) on investments |
(120,161,259 | ) | 98,157,416 | |||||
Net increase/(decrease) in net assets resulting from operations |
(107,015,332 | ) | 102,716,560 | |||||
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM: |
||||||||
Total distributable earnings |
(1,325,790 | ) | (1,629,559 | ) | ||||
Net decrease in net assets from dividends and distributions to shareholders |
(1,325,790 | ) | (1,629,559 | ) | ||||
CAPITAL SHARE TRANSACTIONS: |
||||||||
Proceeds from shares sold |
41,513,113 | 92,015,882 | ||||||
Shares redeemed |
(43,914,753 | ) | (2,638,120 | ) | ||||
Net increase/(decrease) in net assets from capital share transactions |
(2,401,640 | ) | 89,377,762 | |||||
Total increase/(decrease) in net assets |
(110,742,762 | ) | 190,464,763 | |||||
NET ASSETS: |
||||||||
Beginning of period |
528,011,499 | 337,546,736 | ||||||
End of period |
$ | 417,268,737 | $ | 528,011,499 | ||||
SHARES TRANSACTIONS: |
||||||||
Shares sold |
975,000 | 2,575,000 | ||||||
Shares redeemed |
(1,225,000 | ) | (75,000 | ) | ||||
Net increase/(decrease) in shares outstanding |
(250,000 | ) | 2,500,000 |
The accompanying notes are an integral part of these financial statements.
65 |
Motley Fool Small-Cap Growth ETF
Statements of Changes in Net Assets
|
FOR
THE |
FOR
THE |
||||||
INCREASE/(DECREASE) IN NET ASSETS FROM OPERATIONS: |
||||||||
Net investment income/(loss) |
$ | (571,366 | ) | $ | (838,753 | ) | ||
Net realized gain/(loss) from investments |
12,159,631 | 11,029,903 | ||||||
Net change in unrealized appreciation/(depreciation) on investments |
(70,725,754 | ) | 26,857,789 | |||||
Net increase/(decrease) in net assets resulting from operations |
(59,137,489 | ) | 37,048,939 | |||||
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM: |
||||||||
Total distributable earnings |
(3,829,540 | ) | (8,371,857 | ) | ||||
Net decrease in net assets from dividends and distributions to shareholders |
(3,829,540 | ) | (8,371,857 | ) | ||||
CAPITAL SHARE TRANSACTIONS: |
||||||||
Proceeds from shares sold |
2,045,968 | 68,065,890 | ||||||
Shares redeemed |
(50,410,673 | ) | (14,105,940 | ) | ||||
Net increase/(decrease) in net assets from capital share transactions |
(48,364,705 | ) | 53,959,950 | |||||
Total increase/(decrease) in net assets |
(111,331,734 | ) | 82,637,032 | |||||
NET ASSETS: |
||||||||
Beginning of period |
189,381,589 | 106,744,557 | ||||||
End of period |
$ | 78,049,855 | $ | 189,381,589 | ||||
SHARES TRANSACTIONS: |
||||||||
Shares sold |
50,000 | 1,750,000 | ||||||
Shares redeemed |
(1,600,000 | ) | (375,000 | ) | ||||
Net increase/(decrease) in shares outstanding |
(1,550,000 | ) | 1,375,000 |
The accompanying notes are an integral part of these financial statements.
66 |
MOTLEY FOOL CAPITAL EFFICIENCY 100 INDEX ETF
Statement of Changes in Net Assets
|
FOR
THE |
|||
INCREASE/(DECREASE) IN NET ASSETS FROM OPERATIONS: |
||||
Net investment income/(loss) |
$ | 42,783 | ||
Net realized gain/(loss) from investments |
(369,769 | ) | ||
Net change in unrealized appreciation/(depreciation) on investments |
(1,917,628 | ) | ||
Net increase/(decrease) in net assets resulting from operations |
(2,244,614 | ) | ||
CAPITAL SHARE TRANSACTIONS: |
||||
Proceeds from shares sold |
24,197,108 | |||
Shares redeemed |
(1,198,305 | ) | ||
Net increase/(decrease) in net assets from capital share transactions |
22,998,803 | |||
Total increase/(decrease) in net assets |
20,754,189 | |||
NET ASSETS: |
||||
Beginning of period |
— | |||
End of period |
$ | 20,754,189 | ||
SHARES TRANSACTIONS: |
||||
Shares sold |
1,425,000 | |||
Shares redeemed |
(75,000 | ) | ||
Net increase/(decrease) in shares outstanding |
1,350,000 |
* |
Inception date of the Fund was December 30, 2021. |
The accompanying notes are an integral part of these financial statements.
67 |
MOTLEY FOOL NEXT INDEX ETF
Statement of Changes in Net Assets
|
FOR
THE |
|||
INCREASE/(DECREASE) IN NET ASSETS FROM OPERATIONS: |
||||
Net investment income/(loss) |
$ | 50,952 | ||
Net realized gain/(loss) from investments |
(268,811 | ) | ||
Net change in unrealized appreciation/(depreciation) on investments |
(6,202,144 | ) | ||
Net increase/(decrease) in net assets resulting from operations |
(6,420,003 | ) | ||
CAPITAL SHARE TRANSACTIONS: |
||||
Proceeds from shares sold |
39,453,233 | |||
Shares redeemed |
(355,253 | ) | ||
Net increase/(decrease) in net assets from capital share transactions |
39,097,980 | |||
Total increase/(decrease) in net assets |
32,677,977 | |||
NET ASSETS: |
||||
Beginning of period |
— | |||
End of period |
$ | 32,677,977 | ||
SHARES TRANSACTIONS: |
||||
Shares sold |
2,200,000 | |||
Shares redeemed |
(25,000 | ) | ||
Net increase/(decrease) in shares outstanding |
2,175,000 |
* |
Inception date of the Fund was December 30, 2021. |
The accompanying notes are an integral part of these financial statements.
68 |
MOTLEY
FOOL Global Opportunities ETF
Financial Highlights
Contained below is per share operating performance data for shares outstanding, total investment return/(loss), ratios to average net assets and other supplemental data for the respective periods. This information has been derived from information provided in the financial statements.
|
YEARS
ENDED |
|||||||||||||||||||
|
2022 |
2021 |
2020 |
2019 |
2018 |
|||||||||||||||
PER SHARE OPERATING PERFORMANCE |
||||||||||||||||||||
Net asset value, beginning of period |
$ | 37.03 | $ | 30.17 | $ | 25.09 | $ | 25.97 | $ | 24.09 | ||||||||||
Net investment income/(loss)(1) |
0.30 | (0.05 | ) | — | * | 0.05 | 0.02 | |||||||||||||
Net realized and unrealized gain/(loss) from investments |
(10.00 | ) | 9.03 | 6.21 | 0.80 | 4.94 | ||||||||||||||
Net increase/(decrease) in net assets resulting from operations |
(9.70 | ) | 8.98 | 6.21 | 0.85 | 4.96 | ||||||||||||||
Dividends and distributions to shareholders from: |
||||||||||||||||||||
Net investment income |
(0.77 | ) | — | (0.04 | ) | — | (0.03 | ) | ||||||||||||
Net realized capital gains |
(1.81 | ) | (2.12 | ) | (1.09 | ) | (1.73 | ) | (3.05 | ) | ||||||||||
Total dividends and distributions to shareholders |
(2.58 | ) | (2.12 | ) | (1.13 | ) | (1.73 | ) | (3.08 | ) | ||||||||||
Redemption and small-balance account fees |
— | — | — | — | — | * | ||||||||||||||
Net asset value, end of period |
$ | 24.75 | $ | 37.03 | $ | 30.17 | $ | 25.09 | $ | 25.97 | ||||||||||
Market value, end of period |
$ | 24.74 | $ | — | $ | — | $ | — | $ | — | ||||||||||
Total investment return/(loss) on net asset value(2) |
(27.61 | )% | 30.86 | % | 25.64 | % | 4.94 | % | 22.48 | % | ||||||||||
Total investment return/(loss) on market price(3) |
(27.65 | )% | — | % | — | % | — | % | — | % | ||||||||||
RATIOS/SUPPLEMENTAL DATA |
||||||||||||||||||||
Net assets, end of period (000’s omitted) |
$ | 433,652 | $ | 181,509 | $ | 122,406 | $ | 92,760 | $ | 78,987 | ||||||||||
Ratio of expenses to average net assets |
0.87 | % | 0.95 | % | 0.95 | % | 0.95 | % | 0.95 | % | ||||||||||
Ratio of expenses to average net assets (before waivers and reimbursement of expenses and/or recapture of previously waived fees) |
0.88 | % | 0.98 | % | 1.00 | % | 0.99 | % | 1.06 | % | ||||||||||
Ratio of net investment income/(loss) to average net assets |
1.08 | % | (0.16 | )% | (0.01 | )% | 0.19 | % | 0.07 | % | ||||||||||
Ratio of net investment income/(loss) to average net assets (before waivers and reimbursement of expenses and/or recapture of previously waived fees) |
1.07 | % | (0.19 | )% | (0.06 | )% | 0.15 | % | (0.04 | )% | ||||||||||
Portfolio turnover rate |
14 | % | 12 | % | 10 | % | 11 | % | 15 | % |
* |
Amount represents less than $0.005 per share. |
(1) |
Per share data calculated using average shares outstanding method. |
(2) |
Total investment return/(loss) on net asset value is calculated assuming a purchase of shares on the first day and a sale of shares on the last day of each period reported and includes reinvestments of dividends and distributions, if any. |
(3) |
Total investment return/(loss) on market price is calculated assuming an initial investment made at the market price on the first day of the period, reinvestment of dividends and distributions at market price during the period and redemption at market price on the last day of the period. |
The accompanying notes are an integral part of these financial statements.
69 |
MOTLEY
FOOL Mid-Cap Growth ETF
Financial Highlights
Contained below is per share operating performance data for shares outstanding, total investment return/(loss), ratios to average net assets and other supplemental data for the respective periods. This information has been derived from information provided in the financial statements.
|
YEARS
ENDED |
|||||||||||||||||||
|
2022 |
2021 |
2020 |
2019 |
2018 |
|||||||||||||||
PER SHARE OPERATING PERFORMANCE |
||||||||||||||||||||
Net asset value, beginning of period |
$ | 33.20 | $ | 29.79 | $ | 24.48 | $ | 27.50 | $ | 22.14 | ||||||||||
Net investment income/(loss)(1) |
(0.04 | ) | (0.09 | ) | (0.02 | ) | 0.02 | (0.01 | ) | |||||||||||
Net realized and unrealized gain/(loss) from investments |
(8.38 | ) | 6.90 | 6.79 | (1.88 | ) | 6.72 | |||||||||||||
Net increase/(decrease) in net assets resulting from operations |
(8.42 | ) | 6.81 | 6.77 | (1.86 | ) | 6.71 | |||||||||||||
Dividends and distributions to shareholders from: |
||||||||||||||||||||
Net investment income |
— | — | — | — | — | |||||||||||||||
Net realized capital gains |
(2.10 | ) | (3.40 | ) | (1.46 | ) | (1.16 | ) | (1.35 | ) | ||||||||||
Total dividends and distributions to shareholders |
(2.10 | ) | (3.40 | ) | (1.46 | ) | (1.16 | ) | (1.35 | ) | ||||||||||
Redemption and small-balance account fees |
— | — | — | — | — | * | ||||||||||||||
Net asset value, end of period |
$ | 22.68 | $ | 33.20 | $ | 29.79 | $ | 24.48 | $ | 27.50 | ||||||||||
Market value, end of period |
$ | 22.62 | $ | — | $ | — | $ | — | $ | — | ||||||||||
Total investment return/(loss) on net asset value (2) |
(26.66 | )% | 24.38 | % | 28.77 | % | (5.97 | )% | 31.10 | % | ||||||||||
Total investment return/(loss) on market price (3) |
(26.84 | )% | — | % | — | % | — | % | — | % | ||||||||||
RATIOS/SUPPLEMENTAL DATA |
||||||||||||||||||||
Net assets, end of period (000’s omitted) |
$ | 209,044 | $ | 54,460 | $ | 39,488 | $ | 29,205 | $ | 30,562 | ||||||||||
Ratio of expenses to average net assets |
0.90 | % | 0.95 | % | 0.95 | % | 0.95 | % | 0.95 | % | ||||||||||
Ratio of expenses to average net assets (before waivers and reimbursement of expenses and/or recapture of previously waived fees) |
0.88 | % | 0.98 | % | 1.00 | % | 0.98 | % | 1.17 | % | ||||||||||
Ratio of net investment income/(loss) to average net assets |
(0.17 | )% | (0.30 | )% | (0.06 | )% | 0.10 | % | (0.05 | )% | ||||||||||
Ratio of net investment income/(loss) to average net assets (before waivers and reimbursement of expenses and/or recapture of previously waived fees) |
(0.15 | )% | (0.33 | )% | (0.11 | )% | 0.07 | % | (0.26 | )% | ||||||||||
Portfolio turnover rate |
2 | % | 15 | % | 14 | % | 4 | % | 19 | % |
* |
Amount represents less than $0.005 per share. |
(1) |
Per share data calculated using average shares outstanding method. |
(2) |
Total investment return/(loss) on net asset value is calculated assuming a purchase of shares on the first day and a sale of shares on the last day of each period reported and includes reinvestments of dividends and distributions, if any. |
(3) |
Total investment return/(loss) on market price is calculated assuming an initial investment made at the market price on the first day of the period, reinvestment of dividends and distributions at market price during the period and redemption at market price on the last day of the period. |
The accompanying notes are an integral part of these financial statements.
70 |
Motley Fool 100 Index ETF
Financial Highlights
Contained below is per share operating performance data for shares outstanding, total investment return/(loss), ratios to average net assets and other supplemental data for the respective periods. This information has been derived from information provided in the financial statements.
|
YEARS ENDED AUGUST 31, |
For
the |
||||||||||||||||||
|
2022 |
2021 |
2020 |
2019 |
2018(1) |
|||||||||||||||
PER SHARE OPERATING PERFORMANCE |
||||||||||||||||||||
Net asset value, beginning of period |
$ | 42.16 | $ | 33.67 | $ | 22.46 | $ | 22.10 | $ | 20.00 | ||||||||||
Net investment income/(loss)(2) |
0.08 | 0.05 | 0.11 | 0.15 | 0.08 | |||||||||||||||
Net realized and unrealized gain/(loss) from investments |
(8.15 | ) | 8.59 | 11.23 | 0.32 | 2.02 | ||||||||||||||
Net increase/(decrease) in net assets resulting from operations |
(8.07 | ) | 8.64 | 11.34 | 0.47 | 2.10 | ||||||||||||||
Dividends and distributions to shareholders from: |
||||||||||||||||||||
Net investment income |
(0.02 | ) | (0.10 | ) | (0.13 | ) | (0.11 | ) | — | |||||||||||
Net realized capital gains |
(0.08 | ) | (0.05 | ) | — | — | — | |||||||||||||
Total dividends and distributions to shareholders |
(0.10 | ) | (0.15 | ) | (0.13 | ) | (0.11 | ) | — | |||||||||||
Net asset value, end of period |
$ | 33.99 | $ | 42.16 | $ | 33.67 | $ | 22.46 | $ | 22.10 | ||||||||||
Market value, end of period |
$ | 34.00 | $ | 42.20 | $ | 33.66 | $ | 22.42 | $ | 22.13 | ||||||||||
Total investment return/(loss) on net asset value(3) |
(19.18 | )% | 25.74 | % | 50.67 | % | 2.27 | % | 10.49 | %(5) | ||||||||||
Total investment return/(loss) on market price(4) |
(19.24 | )% | 25.91 | % | 50.89 | % | 1.93 | % | 10.65 | %(5) | ||||||||||
RATIOS/SUPPLEMENTAL DATA |
||||||||||||||||||||
Net assets, end of period (000’s omitted) |
$ | 417,269 | $ | 528,011 | $ | 337,547 | $ | 185,871 | $ | 140,879 | ||||||||||
Ratio of expenses to average net assets |
0.50 | % | 0.50 | % | 0.50 | % | 0.50 | % | 0.50 | %(6) | ||||||||||
Ratio of net investment income/(loss) to average net assets |
0.20 | % | 0.15 | % | 0.43 | % | 0.69 | % | 0.68 | %(6) | ||||||||||
Portfolio turnover rate |
15 | % | 23 | % | 26 | % | 26 | % | 10 | %(5) |
(1) |
Inception date of the Fund was January 29, 2018. |
(2) |
Per share data calculated using average shares outstanding method. |
(3) |
Total investment return/(loss) on net asset value is calculated assuming a purchase of shares on the first day and a sale of shares on the last day of each period reported and includes reinvestments of dividends and distributions, if any. |
(4) |
Total investment return/(loss) on market price is calculated assuming an initial investment made at the market price on the first day of the period, reinvestment of dividends and distributions at market price during the period and redemption at market price on the last day of the period. |
(5) |
Not annualized. |
(6) |
Annualized. |
The accompanying notes are an integral part of these financial statements.
71 |
MOTLEY FOOL Small-Cap Growth ETF
Financial Highlights
Contained below is per share operating performance data for shares outstanding, total investment return/(loss) return, ratios to average net assets and other supplemental data for the respective periods. This information has been derived from information provided in the financial statements.
|
YEARS ENDED AUGUST 31, |
FOR
THE |
||||||||||||||
|
2022 |
2021 |
2020 |
2019(1) |
||||||||||||
PER SHARE OPERATING PERFORMANCE |
||||||||||||||||
Net asset value, beginning of period |
$ | 40.73 | $ | 32.59 | $ | 23.33 | $ | 20.00 | ||||||||
Net investment income/(loss)(2) |
(0.15 | ) | (0.19 | ) | (0.07 | ) | — | * | ||||||||
Net realized and unrealized gain/(loss) from investments |
(14.53 | ) | 10.48 | 9.67 | 3.33 | |||||||||||
Net increase/(decrease) in net assets resulting from operations |
(14.68 | ) | 10.29 | 9.60 | 3.33 | |||||||||||
Dividends and distributions to shareholders from: |
||||||||||||||||
Net realized capital gains |
(0.87 | ) | (2.15 | ) | (0.34 | ) | — | |||||||||
Total dividends and distributions to shareholders |
(0.87 | ) | (2.15 | ) | (0.34 | ) | — | |||||||||
Net asset value, end of period |
$ | 25.18 | $ | 40.73 | $ | 32.59 | $ | 23.33 | ||||||||
Market value, end of period |
$ | 25.18 | $ | 40.74 | $ | 32.68 | $ | 23.34 | ||||||||
Total investment return/(loss) on net asset value(3) |
(36.66 | )% | 32.00 | % | 41.58 | % | 16.65 | %(5) | ||||||||
Total investment return/(loss) on market price(4) |
(36.65 | )% | 31.54 | % | 41.88 | % | 16.69 | %(5) | ||||||||
RATIOS/SUPPLEMENTAL DATA |
||||||||||||||||
Net assets, end of period (000’s omitted) |
$ | 78,050 | $ | 189,382 | $ | 106,745 | $ | 71,153 | ||||||||
Ratio of expenses to average net assets |
0.85 | % | 0.85 | % | 0.85 | % | 0.85 | %(6) | ||||||||
Ratio of net investment income/(loss) to average net assets |
(0.46 | )% | (0.51 | )% | (0.29 | )% | (0.01 | )%(6) | ||||||||
Portfolio turnover rate |
11 | % | 21 | % | 27 | % | 21 | %(5) |
* |
Amount represents less than $0.005 per share. |
(1) |
Inception date of the Fund was October 29, 2018. |
(2) |
Per share data calculated using average shares outstanding method. |
(3) |
Total investment return/(loss) on net asset value is calculated assuming a purchase of shares on the first day and a sale of shares on the last day of each period reported and includes reinvestments of dividends and distributions, if any. |
(4) |
Total investment return/(loss) on market price is calculated assuming an initial investment made at the market price on the first day of the period, reinvestment of dividends and distributions at market price during the period and redemption at market price on the last day of the period. |
(5) |
Not annualized. |
(6) |
Annualized. |
The accompanying notes are an integral part of these financial statements.
72 |
Motley Fool CAPITAL EFFICIENCY 100 INDEX ETF
Financial Highlights
Contained below is per share operating performance data for shares outstanding, total investment return/(loss) return, ratios to average net assets and other supplemental data for the respective period. This information has been derived from information provided in the financial statements.
|
For
the |
|||
|
2022(1) |
|||
PER SHARE OPERATING PERFORMANCE |
||||
Net asset value, beginning of period |
$ | 20.00 | ||
Net investment income/(loss)(2) |
0.05 | |||
Net realized and unrealized gain/(loss) from investments |
(4.68 | ) | ||
Net increase/(decrease) in net assets resulting from operations |
(4.63 | ) | ||
Net asset value, end of period |
$ | 15.37 | ||
Market value, end of period |
$ | 15.38 | ||
Total investment return/(loss) on net asset value(3) |
(23.13 | )%(5) | ||
Total investment return/(loss) on market price(4) |
(23.09 | )%(5) | ||
RATIOS/SUPPLEMENTAL DATA |
||||
Net assets, end of period (000’s omitted) |
$ | 20,754 | ||
Ratio of expenses to average net assets |
0.50 | %(6) | ||
Ratio of net investment income/(loss) to average net assets |
0.50 | %(6) | ||
Portfolio turnover rate |
17 | %(5) |
(1) |
Inception date of the Fund was December 30, 2021. |
(2) |
Per share data calculated using average shares outstanding method. |
(3) |
Total investment return/(loss) on net asset value is calculated assuming a purchase of shares on the first day and a sale of shares on the last day of each period reported and includes reinvestments of dividends and distributions, if any. |
(4) |
Total investment return/(loss) on market price is calculated assuming an initial investment made at the market price on the first day of the period, reinvestment of dividends and distributions at market price during the period and redemption at market price on the last day of the period. |
(5) |
Not annualized. |
(6) |
Annualized. |
The accompanying notes are an integral part of these financial statements.
73 |
MOTLEY FOOL NEXT INDEX ETF
Financial Highlights
Contained below is per share operating performance data for shares outstanding, total investment return/(loss) return, ratios to average net assets and other supplemental data for the respective period. This information has been derived from information provided in the financial statements.
|
For
the |
|||
|
2022(1) |
|||
PER SHARE OPERATING PERFORMANCE |
||||
Net asset value, beginning of period |
$ | 20.00 | ||
Net investment income/(loss)(2) |
0.03 | |||
Net realized and unrealized gain/(loss) from investments |
(5.01 | ) | ||
Net increase/(decrease) in net assets resulting from operations |
(4.98 | ) | ||
Net asset value, end of period |
$ | 15.02 | ||
Market value, end of period |
$ | 15.01 | ||
Total investment return/(loss) on net asset value(3) |
(24.88 | )%(5) | ||
Total investment return/(loss) on market price(4) |
(24.97 | )%(5) | ||
RATIOS/SUPPLEMENTAL DATA |
||||
Net assets, end of period (000’s omitted) |
$ | 32,678 | ||
Ratio of expenses to average net assets |
0.50 | %(6) | ||
Ratio of net investment income/(loss) to average net assets |
0.26 | %(6) | ||
Portfolio turnover rate |
11 | %(5) |
(1) |
Inception date of the Fund was December 30, 2021. |
(2) |
Per share data calculated using average shares outstanding method. |
(3) |
Total investment return/(loss) on net asset value is calculated assuming a purchase of shares on the first day and a sale of shares on the last day of each period reported and includes reinvestments of dividends and distributions, if any. |
(4) |
Total investment return/(loss) on market price is calculated assuming an initial investment made at the market price on the first day of the period, reinvestment of dividends and distributions at market price during the period and redemption at market price on the last day of the period. |
(5) |
Not annualized. |
(6) |
Annualized. |
The accompanying notes are an integral part of these financial statements.
74 |
Motley Fool Asset Management ETFs
Notes to Financial Statements
AUGUST 31, 2022
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
The RBB Fund, Inc. (“RBB” or the “Company”) was incorporated under the laws of the State of Maryland on February 29, 1988 and is registered under the Investment Company Act of 1940, as amended, (the “1940 Act”), as an open-end management investment company. RBB is a “series fund,” which is a mutual fund divided into separate portfolios. Each portfolio is treated as a separate entity for certain matters under the 1940 Act, and for other purposes, and a shareholder of one portfolio is not deemed to be a shareholder of any other portfolio. Currently, RBB has forty-eight separate investment portfolios, including the Motley Fool Global Opportunities ETF (“Global Opportunities Fund”) (formerly MFAM Global Opportunities Fund), the Motley Fool Mid-Cap Growth ETF (“Mid-Cap Growth Fund”) (formerly MFAM Mid-Cap Growth Fund), the Motley Fool 100 Index ETF (the “Fool 100 Fund”), the Motley Fool Small-Cap Growth ETF (“Small-Cap Growth Fund”) (formerly MFAM Small-Cap Growth ETF), the Motley Fool Capital Efficiency 100 Index ETF (“Capital Efficiency Fund”) and the Motley Fool Next Index ETF (“Next Fund”) (each a “Fund” and together the “Funds”). The Global Opportunities Fund, Mid-Cap Growth Fund, Fool 100 Fund, Small-Cap Growth Fund, Capital Efficiency Fund and Next Fund commenced investment operations on June 17, 2014, June 17, 2014, January 29, 2018, October 29, 2018, December 30, 2021 and December 30, 2021, respectively.
Effective December 3, 2021 (the “Conversion Date”), the outstanding Investor Class Shares of the Global Opportunities Fund and Mid-Cap Growth Fund were converted into Institutional Class Shares of the Funds (the “Class Conversions”). The Class Conversions were completed based on the share classes’ relative net asset values on the Conversion Date, without the imposition of any fees or expenses. All Investor Class Shares of the Funds were converted into Institutional Class Shares as of the Conversion Date.
Global Opportunities Fund |
SHARES
|
NET ASSETS |
NAV |
SHARE
|
||||||||||||
Investor Class |
14,816,530 | $ | 458,343,422 | $ | 30.93 | 0.993 | ||||||||||
Institutional Class (before conversion) |
5,282,341 | 164,492,179 | 31.14 | |||||||||||||
Institutional Class (after conversion) |
20,001,071 | 622,835,355 | 31.14 |
Mid-Cap Growth Fund |
SHARES
|
NET ASSETS |
NAV |
SHARE
|
||||||||||||
Investor Class |
8,829,770 | $ | 250,730,153 | $ | 28.40 | 0.985 | ||||||||||
Institutional Class (before conversion) |
1,739,846 | 50,143,889 | 28.82 | |||||||||||||
Institutional Class (after conversion) |
10,439,367 | 300,874,042 | 28.82 |
The Funds identified below as “Acquiring Portfolios” became series of the Trust as of the date indicated following a reorganization (“Reorganization”), pursuant to Agreements and Plans of Reorganization dated as shown below (each, a “Plan” and collectively, the “Plans”), which resulted in the conversion of corresponding “Target Portfolios” organized as mutual funds to ETFs. The Acquiring Portfolios were established as “shell” funds, organized solely in connection with the Reorganization for the purpose of acquiring the assets and liabilities of the corresponding Target Portfolios and continuing the operations of the Target Portfolios as ETFs. The Acquiring Portfolios had no performance history prior to the Reorganization.
TARGET PORTFOLIO |
ACQUIRING PORTFOLIO |
DATE |
||||
MFAM Global Opportunities Fund |
Motley Fool Global Opportunities ETF | December 10, 2021 | ||||
MFAM Mid-Cap Growth Fund |
Motley Fool Mid-Cap Growth ETF | December 10, 2021 |
75 |
Motley Fool Asset Management ETFs
Notes to Financial Statements (continued)
AUGUST 31, 2022
Each Reorganization was accomplished by a tax-free exchange of shares (with an exception for fractional mutual fund shares) of the Acquiring Portfolio for shares of the Target Portfolio of equivalent aggregate net asset value as noted below:
|
TOTAL |
NET ASSETS |
NAV |
NET
UNREALIZED |
||||||||||||
MFAM Global Opportunities Fund |
19,909,457 | $ | 630,424,871 | $ | 31.66 | 317,322,900 | ||||||||||
MFAM Mid-Cap Growth Fund |
10,390,334 | 300,059,021 | 28.88 | 161,308,304 |
Fees and expenses incurred to effect the Reorganizations were borne by Motley Fool Asset Management, LLC (the “Adviser”). The management fee of each Acquiring Portfolio is the same as the management fee of its corresponding Target Portfolio, however, each Acquiring Portfolio is expected to experience lower overall expenses as compared to its corresponding Target Portfolio because each Acquiring Portfolio has a unitary fee structure under which both operating expenses and management fees are paid. The Reorganizations did not result in a material change to the Target Portfolios’ investment portfolios as compared to those of the Acquiring Portfolios. There are no material differences in accounting policies of the Target Portfolios as compared to those of the Acquiring Portfolios.
The Acquiring Portfolios did not purchase or sell securities following the Reorganizations for purposes of realigning its investment portfolio. Accordingly, the acquisition of the Target Portfolios did not affect the Acquiring Portfolios’ portfolio turnover ratios for the period ended August 31, 2022.
RBB has authorized capital of one hundred billion shares of common stock of which 90.023 billion shares are currently classified into two hundred and eleven classes of common stock. Each class represents an interest in an active or inactive RBB investment portfolio.
The investment objective of each Fund is to achieve long-term capital appreciation. The Global Opportunities Fund pursues its objective by investing primarily in common stocks of United States companies and of companies that are organized under the laws of other countries around the world. The Mid-Cap Growth Fund pursues its objective by investing primarily in common stocks of companies that are organized in the United States and that are engaged in a broad range of industries.
The investment objective of the Fool 100 Fund is to achieve investment results that correspond (before fees and expenses) generally to the total return performance of the Motley Fool 100 Index (the “Fool 100 Index”). The Fool 100 Index was developed by The Motley Fool, LLC (“The Motley Fool”), an affiliate of the Adviser, in 2017 and is a proprietary, rules-based index designed to track the performance of the 100 largest, most liquid U.S. companies that have been recommended by The Motley Fool’s analysts and newsletters or the highest-rated stocks in Fool IQ, the company’s analyst opinion database. Every company include in the Fool 100 Index is incorporated and listed in the U.S. The investment objective of the Small-Cap Growth Fund is to achieve long-term capital appreciation.
The investment objective of the Capital Efficiency Fund is to seek investment results that correspond (before fees and expenses) generally to the total return performance of the Motley Fool Capital Efficiency 100 Index (the “Capital Efficiency 100 Index”). The Capital Efficiency 100 Index was developed by The Motley Fool in 2021 and is a proprietary, rules-based index designed to track the performance of the highest scoring stocks of U.S. companies, measured by a company’s capital efficiency, that have been recommended by The Motley Fool’s analysts and newsletters, and that also meet certain liquidity requirements. Capital efficiency is a measure of how a business turns its investments into revenue and profit and it provides insight into the company’s return on invested capital. Every company included in the Capital Efficiency 100 Index is incorporated and listed in the U.S. The investment objective of the Next Fund is to seek investment results that correspond (before fees and expenses) generally to the total return performance of the Motley Fool Next Index (the “Next Index”). The Next Index was developed by The Motley Fool in 2021 and is a proprietary, rules-based index designed to track the performance of the 100 largest, most liquid U.S. companies that have been recommended by The Motley Fool’s analysts and newsletters. Every company included in the Next Index is incorporated and listed in the U.S.
The Funds are investment companies and follow accounting and reporting guidance in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Topic 946 “Financial Services - Investment Companies”.
76 |
Motley Fool Asset Management ETFs
Notes to Financial Statements (continued)
AUGUST 31, 2022
The end of the reporting period for the Funds is August 31, 2022, and the period covered by these Notes to Financial Statements is the fiscal year ended August 31, 2022 (the “current fiscal period”).
PORTFOLIO VALUATION — Each Fund’s net asset value (“NAV”) is calculated once daily at the close of regular trading hours on the New York Stock Exchange (“NYSE”) (generally 4:00 p.m. Eastern time) on each day the NYSE is open. Securities held by the Funds are valued using the closing price or the last sale price on a national securities exchange or the National Association of Securities Dealers Automatic Quotation System (“NASDAQ”) market system where they are primarily traded. Equity securities traded in the over-the-counter (“OTC”) market are valued at their closing prices. If there were no transactions on that day, securities traded principally on an exchange or on NASDAQ will be valued at the mean of the last bid and ask prices prior to the market close. Fixed income securities are valued using an independent pricing service, which considers such factors as security prices, yields, maturities and ratings, and are deemed representative of market values at the close of the market. Foreign securities are valued based on prices from the primary market in which they are traded, and are translated from the local currency into U.S. dollars using current exchange rates. If market quotations are unavailable or deemed unreliable, securities will be valued in accordance with procedures adopted by the Company’s Board of Directors (the “Board”). Relying on prices supplied by pricing services or dealers or using fair valuation may result in values that are higher or lower than the values used by other investment companies and investors to price the same investments. Such procedures use fundamental valuation methods, which may include, but are not limited to, an analysis of the effect of any restrictions on the resale of the security, industry analysis and trends, significant changes in the issuer’s financial position, and any other event which could have a significant impact on the value of the security. Determination of fair value involves subjective judgment as the actual market value of a particular security can be established only by negotiations between the parties in a sales transaction, and the difference between the recorded fair value and the value that would be received in a sale could be significant.
FAIR VALUE MEASUREMENTS — The inputs and valuation techniques used to measure the fair value of the Funds’ investments are summarized into three levels as described in the hierarchy below:
● |
Level 1 – Prices are determined using quoted prices in active markets for identical securities. |
● |
Level 2 – Prices are determined using other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.). |
● |
Level 3 – Prices are determined using significant unobservable inputs (including the Funds’ own assumptions in determining the fair value of investments). |
The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.
The following is a summary of the inputs used, as of the end of the reporting period, in valuing the Funds’ investments carried at fair value:
GLOBAL OPPORTUNITIES FUND
|
TOTAL |
LEVEL 1 |
LEVEL 2 |
LEVEL 3 |
INVESTMENTS
|
|||||||||||||||
Common Stocks |
$ | 423,553,509 | $ | 423,553,509 | $ | — | $ | — | ** | $ | — | |||||||||
Investments Purchased with Proceeds From Securities Lending Collateral |
33,805,832 | — | — | — | 33,805,832 | |||||||||||||||
Short-Term Investments |
9,326,426 | 9,326,426 | — | — | — | |||||||||||||||
Total Investments* |
$ | 466,685,767 | $ | 432,879,935 | $ | — | $ | — | $ | 33,805,832 |
77 |
Motley Fool Asset Management ETFs
Notes to Financial Statements (continued)
AUGUST 31, 2022
MID-CAP GROWTH FUND
|
TOTAL |
LEVEL 1 |
LEVEL 2 |
LEVEL 3 |
INVESTMENTS
|
|||||||||||||||
Common Stocks |
$ | 196,123,527 | $ | 196,123,527 | $ | — | $ | — | $ | — | ||||||||||
Investments Purchased with Proceeds From Securities Lending Collateral |
31,234,388 | — | — | — | 31,234,388 | |||||||||||||||
Short-Term Investments |
13,654,888 | 13,654,888 | — | — | — | |||||||||||||||
Total Investments* |
$ | 241,012,803 | $ | 209,778,415 | $ | — | $ | — | $ | 31,234,388 |
FOOL 100 FUND
|
TOTAL |
LEVEL 1 |
LEVEL 2 |
LEVEL 3 |
INVESTMENTS
|
|||||||||||||||
Common Stocks |
$ | 416,656,530 | $ | 416,656,530 | $ | — | $ | — | $ | — | ||||||||||
Rights |
32,547 | — | — | 32,547 | — | |||||||||||||||
Investments Purchased with Proceeds From Securities Lending Collateral |
21,230,044 | — | — | — | 21,230,044 | |||||||||||||||
Short-Term Investments |
387,749 | 387,749 | — | — | — | |||||||||||||||
Total Investments* |
$ | 438,306,870 | $ | 417,044,279 | $ | — | $ | 32,547 | $ | 21,230,044 |
SMALL-CAP GROWTH FUND
|
TOTAL |
LEVEL 1 |
LEVEL 2 |
LEVEL 3 |
INVESTMENTS
|
|||||||||||||||
Common Stocks |
$ | 73,033,081 | $ | 73,033,081 | $ | — | $ | — | $ | — | ||||||||||
Investments Purchased with Proceeds From Securities Lending Collateral |
17,127,093 | — | — | — | 17,127,093 | |||||||||||||||
Short-Term Investments |
5,053,164 | 5,053,164 | — | — | — | |||||||||||||||
Total Investments* |
$ | 95,213,338 | $ | 78,086,245 | $ | — | $ | — | $ | 17,127,093 |
78 |
Motley Fool Asset Management ETFs
Notes to Financial Statements (continued)
AUGUST 31, 2022
CAPITAL EFFICIENCY FUND
|
TOTAL |
LEVEL 1 |
LEVEL 2 |
LEVEL 3 |
INVESTMENTS
|
|||||||||||||||
Common Stocks |
$ | 20,718,641 | $ | 20,718,641 | $ | — | $ | — | $ | — | ||||||||||
Short-Term Investments |
17,495 | 17,495 | — | — | — | |||||||||||||||
Total Investments* |
$ | 20,736,136 | $ | 20,736,136 | $ | — | $ | — | $ | — |
NEXT FUND
|
TOTAL |
LEVEL 1 |
LEVEL 2 |
LEVEL 3 |
INVESTMENTS
|
|||||||||||||||
Common Stocks |
$ | 32,579,831 | $ | 32,579,831 | $ | — | $ | — | $ | — | ||||||||||
Short-Term Investments |
85,879 | 85,879 | — | — | — | |||||||||||||||
Total Investments* |
$ | 32,665,710 | $ | 32,665,710 | $ | — | $ | — | $ | — |
* |
Please refer to the Schedule of Investments for further details. |
** |
Value equals zero as of the end of the reporting period. |
^ |
Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in the table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the Statements of Assets and Liabilities. |
At the end of each quarter, management evaluates the classification of Levels 1, 2 and 3 assets and liabilities. Various factors are considered, such as changes in liquidity from the prior reporting period; whether or not a broker is willing to execute at the quoted price; the depth and consistency of prices from third party pricing services; and the existence of contemporaneous, observable trades in the market. Additionally, management evaluates the classification of Levels 1, 2 and 3 assets and liabilities on a quarterly basis for changes in listings or delistings on national exchanges.
Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the fair value of the Funds’ investments may fluctuate from period to period. Additionally, the fair value of investments may differ significantly from the values that would have been used had a ready market existed for such investments and may differ materially from the values the Funds may ultimately realize. Further, such investments may be subject to legal and other restrictions on resale or otherwise less liquid than publicly traded securities.
For fair valuations using significant unobservable inputs, U.S. generally accepted accounting principles (“U.S. GAAP”) requires each Fund to present a reconciliation of the beginning to ending balances for reported market values that presents changes attributable to total realized and unrealized gains or losses, purchase and sales, and transfers in and out of Level 3 during the period. Transfers in and out between levels are based on values at the end of the period. A reconciliation of Level 3 investments is presented only when a Fund had an amount of Level 3 investments at the end of the reporting period that was meaningful in relation to its net assets. The amounts and reasons for all Level 3 transfers are disclosed if a Fund had an amount of total Level 3 transfers during the reporting period that was meaningful in relation to its net assets as of the end of the reporting period.
During the current fiscal period, the Funds had no Level 3 transfers.
79 |
Motley Fool Asset Management ETFs
Notes to Financial Statements (continued)
AUGUST 31, 2022
USE OF ESTIMATES — The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and those differences could be significant.
INVESTMENT TRANSACTIONS, INVESTMENT INCOME AND EXPENSES — The Funds record security transactions based on trade date for financial reporting purposes. The cost of investments sold is determined by use of the specific identification method for both financial reporting and income tax purposes in determining realized gains and losses on investments. Interest income (including amortization of premiums and accretion of discounts) is accrued when earned. Dividend income is recorded on the ex-dividend date. Distributions received on securities that represent a return of capital or capital gains are recorded as a reduction of cost of investments and/or as a realized gain. Certain expenses are shared with The RBB Fund Trust (formerly, PENN Capital Funds Trust) (the “Trust”), a series trust of affiliated funds. Expenses incurred on behalf of a specific class, fund or fund family of the Company or Trust are charged directly to the class, fund or fund family (in proportion to net assets). Expenses incurred for all funds (such as director or professional fees) are charged to all funds in proportion to their average net assets of RBB and the Trust, or in such other manner as the Board deems fair or equitable. Expenses and fees, including investment advisory fees, are accrued daily and taken into account for the purpose of determining the NAV of each Fund.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS — Each Fund pays dividends from its net investment income and distributes any net capital gains that it realizes. Dividends and capital gains distributions are generally paid once a year and as required to comply with federal excise tax requirements. Distributions to shareholders are determined in accordance with tax regulations and recorded on ex dividend date. Additionally, each Fund reports details of distribution-related transactions on quarterly account statements. You may not receive a separate confirmation statement for these transactions.
U.S. TAX STATUS — No provision is made for U.S. income taxes as it is the Funds’ intention to continue to qualify for and elect the tax treatment applicable to regulated investment companies under Subchapter M of the Internal Revenue Code of 1986, as amended, and make the requisite distributions to its shareholders which will be sufficient to relieve it from U.S. income and excise taxes.
CORONAVIRUS (COVID-19) PANDEMIC — The global outbreak of COVID-19 (commonly referred to as “coronavirus”) has disrupted economic markets and the prolonged economic impact is uncertain. Although vaccines for COVID-19 are available, the ultimate economic fallout from the pandemic, and the long-term impact on economies, markets, industries and individual issuers are not known. The operational and financial performance of the issuers of securities in which the Funds invest depends on future developments, including the duration and spread of the outbreak and the pace of recovery which may vary from market to market, and such uncertainty may in turn adversely affect the value and liquidity of the Funds’ investments, impair the Funds’ ability to satisfy redemption requests, and negatively impact the Funds’ performance.
UKRAINE-RUSSIA CONFLICT RISK — In February 2022, Russia commenced a military attack on Ukraine. The outbreak of hostilities between the two countries and the threat of wider-spread hostilities could have a severe adverse effect on the region and global economies, including significant negative impacts on the markets for certain securities and commodities, such as oil and natural gas. In addition, sanctions imposed on Russia by the United States and other countries, and any sanctions imposed in the future, could have a significant adverse impact on the Russian economy and related markets. The price and liquidity of investments may fluctuate widely as a result of the conflict and related events. How long the armed conflict and related events will last cannot be predicted. These tensions and any related events could have a significant impact on Fund performance and the value of Fund investments, even beyond any direct exposure the Fund may have to issuers located in these countries.
CASH AND CASH EQUIVALENTS — Cash and cash equivalents are valued at cost plus accrued interest, which approximates market value.
FOREIGN CURRENCY TRANSLATION — The books and records of the Funds are maintained in U.S. dollars as follows: (1) the values of investment securities and other assets and liabilities stated in foreign currencies are translated at the exchange rates prevailing at the end of the period; and (2) purchases, sales and income are translated at the rates of exchange prevailing on the respective dates of such transactions. Transaction gains or losses resulting from changes in exchange rates during the reporting period or upon settlement from foreign currency transactions are reported in the Statements of Operations for the current period. The Funds do not isolate the portion of gains and losses on investments.
80 |
Motley Fool Asset Management ETFs
Notes to Financial Statements (continued)
AUGUST 31, 2022
OTHER — In the normal course of business, the Funds may enter into contracts that provide general indemnifications. Each Fund’s maximum exposure under these arrangements is dependent on claims that may be made against the Funds in the future, and, therefore, cannot be estimated; however, the Funds expect the risk of material loss from such claims to be remote.
2. Investment Policies and Practices
The sections below describe some of the different types of investments that may be made by the Funds and the investment practices in which the Funds may engage.
TYPES OF FIXED-INCOME SECURITIES — Each Fund may invest in bonds and other types of debt obligations of U.S. and foreign issuers. Fixed income securities purchased by a Fund may include, among others, bonds, notes, and debentures issued by corporations; debt securities issued or guaranteed by the U.S. government or one of its agencies or instrumentalities (“U.S. Government Securities”); municipal securities; mortgage-backed and asset-backed securities; and debt securities issued or guaranteed by foreign governments, their agencies, instrumentalities, or political subdivisions, or by government-owned, -controlled, or -sponsored entities, including central banks. These investments also include money market instruments and other types of obligations. Investors should recognize that, although securities ratings issued by S&P Global Ratings (“S&P”), a division of The McGraw-Hill Companies, Inc., and Moody’s Investors Services©, Inc. (“Moody’s”), provide a generally useful guide as to credit risks, they do not offer any criteria to evaluate interest rate risk. Changes in interest rate levels generally cause fluctuations in the prices of fixed-income securities and will, therefore, cause fluctuations in the NAV per share of a Fund. Subsequent to the purchase of a fixed-income security by a Fund, the ratings or credit quality of such security may deteriorate. Any such subsequent adverse changes in the rating or quality of a security held by a Fund would not require a Fund to sell the security.
REAL ESTATE INVESTMENT TRUSTS — Real estate investment trusts (“REITs”) are pooled investment vehicles that manage a portfolio of real estate or real estate-related loans to earn profits for their shareholders. REITs are generally classified as equity REITs, mortgage REITs, or a combination of equity and mortgage REITs. Investing in REITs involves certain unique risks in addition to those risks associated with investing in the real estate industry in general. Equity REITs may be affected by changes in the value of the underlying property owned by the REITs, while mortgage REITs may be affected by the quality of the borrower on any credit extended. REITs are dependent upon management skills, may not be diversified geographically or by property type, and are subject to heavy cash-flow dependency, default by borrowers, and self-liquidation. REITs must also meet certain requirements under the Internal Revenue Code of 1986, as amended (the “Code”), to avoid entity level tax and be eligible to pass through certain tax attributes of their income to shareholders. REITs are consequently subject to the risk of failing to meet these requirements for favorable tax treatment and of failing to maintain their exemptions from registration under the 1940 Act. REITs are also subject to the risks of changes in the Code, affecting their tax status.
REITs (especially mortgage REITs) are also subject to interest rate risks. When interest rates decline, the value of a REIT’s investment in fixed-rate obligations can be expected to rise. Conversely, when interest rates rise, the value of a REIT’s investment in fixed-rate obligations can be expected to decline. In contrast, as interest rates on adjustable-rate mortgage loans are reset periodically, yields on a REIT’s investments in such loans will gradually align themselves to reflect changes in market interest rates, causing the value of such investments to fluctuate less dramatically in response to interest rate fluctuations than would investments in fixed-rate obligations.
The management of a REIT may be subject to conflicts of interest with respect to the operation of the business of the REIT and may be involved in real estate activities competitive with the REIT. REITs may own properties through joint ventures or in other circumstances in which a REIT may not have control over its investments. REITs may use significant amounts of leverage.
REITs often do not provide complete tax information until after the end of the calendar year. Consequently, because of the delay, it may be necessary for a Fund, if invested in REITs, to request permission to extend the deadline for issuance of Forms 1099-DIV beyond January 31. Alternatively, amended Forms 1099-DIV may be sent.
FOREIGN SECURITIES — The Global Opportunities Fund and the Mid-Cap Growth Fund may invest in equity and fixed-income securities of foreign companies, including companies located in both developed and emerging-market countries. Investment in foreign securities may include the purchase of American Depositary Receipts (“ADRs”) and other depositary receipts (European Depositary Receipts (“EDRs”) and Global Depositary Receipts (“GDRs”)) that represent indirect interests in securities of foreign issuers. A significant portion of a Fund’s exposure to foreign investments may be composed of such investments. Investments in foreign securities are affected by risk factors generally not associated with investments in the securities
81 |
Motley Fool Asset Management ETFs
Notes to Financial Statements (continued)
AUGUST 31, 2022
of U.S. companies in the U.S. With respect to such securities, there may be more limited information publicly available concerning the issuer than would be the case with respect to domestic securities, foreign issuers may use different accounting standards, and foreign trading markets may not be as liquid as are U.S. markets. Foreign securities also involve such risks as currency risks, possible imposition of withholding or confiscatory taxes, possible currency transfer restrictions, expropriation or other adverse political or economic developments, and the difficulty of enforcing obligations in other countries. These risks may be greater in emerging-market countries and in less-developed countries.
The purchase of securities denominated in foreign currencies will subject the value of the Funds’ investments in those securities to fluctuations caused by changes in foreign exchange rates. To hedge against the effects of changes in foreign exchange rates, the Funds may enter into forward foreign currency exchange contracts (“forward contracts”). These contracts represent agreements to exchange an amount of currency at an agreed-upon future date and rate. The Funds will generally use forward contracts only to “lock in” the price in U.S. dollars of a foreign security that a Fund plans to purchase or to sell. In certain limited cases, it may use such contracts to hedge against an anticipated substantial decline in the price of a foreign currency against the U.S. dollar that would adversely affect the U.S. dollar value of foreign securities held by the Fund. Forward contracts will not be used in all cases and, in any event, cannot completely protect the Funds against all changes in the values of foreign securities resulting from fluctuations in foreign exchange rates. The Funds will not enter into a forward contract if, as a result, forward contracts would represent more than 20% of a Fund’s total assets. For hedging purposes, the Funds may also use options on foreign currencies, which expose the Funds to certain risks.
Some foreign securities are traded in the U.S. in the form of ADRs. ADRs are receipts typically issued by a U.S. bank or company evidencing ownership of the underlying securities of foreign issuers. EDRs and GDRs are receipts typically issued by foreign banks or trust companies, evidencing ownership of underlying securities issued by either a foreign or U.S. issuer. Generally, depositary receipts in registered form are designed for use in the U.S. and depositary receipts in bearer form are designed for use in securities markets outside the U.S. Depositary receipts may not necessarily be denominated in the same currency as the underlying securities into which they may be converted. Depositary receipts generally involve the same risks as other investments in foreign securities. However, holders of ADRs and other depositary receipts may not have all the legal rights of shareholders and may experience difficulty in receiving shareholder communications.
PARTICIPATORY NOTES — A participatory note, as used by a Fund, is an instrument used by investors to obtain exposure to an equity investment, including common stocks and warrants, in a local market where direct ownership is not permitted (or is impractical.) In countries where direct ownership by a foreign investor, such as a Fund, is not allowed by local law, such as Saudi Arabia, an investor may gain exposure to the market through a participatory note, which derives its value from a group of underlying equity securities. A participatory note is intended (disregarding the effect of any fees and expenses) to reflect the performance of the underlying equity securities on a one-to-one basis so that investors will not normally gain more in absolute terms than they would have made had they invested in the underlying securities directly, and will not normally lose more than they would have lost had they invested in the underlying securities directly.
In addition to providing access to otherwise closed markets, participatory notes can also provide a less expensive option to direct investment (where ownership by foreign investors is permitted) by reducing registration and transaction costs in acquiring and selling local registered shares. The Funds’ investment manager also believes that participatory notes can offer greater liquidity in markets that restrict the ability of the Funds to dispose of an investment by either restricting transactions by size or requiring registration and/or regulatory approvals.
The purchase of participatory notes involves risks that are in addition to the risks normally associated with a direct investment in the underlying securities. The Fund is subject to the risk that the issuer of the participatory note (i.e., the issuing bank or broker-dealer), which is the only responsible party under the note, is unable or refuses to perform under the terms of the participatory note, also known as counterparty risk.
While the holder of a participatory note is entitled to receive from the bank or broker-dealer any dividends or other distributions paid on the underlying securities, the holder is not entitled to the same rights as an owner of the underlying securities, such as voting rights.
82 |
Motley Fool Asset Management ETFs
Notes to Financial Statements (continued)
AUGUST 31, 2022
Participatory notes may not be traded on exchanges, are privately issued, and may be illiquid. To the extent a participatory note is determined to be illiquid, it would be subject to the Fund’s limitation on investments in illiquid securities. There can be no assurance that the trading price or value of participatory notes will equal the value of the underlying value of the equity securities they seek to replicate.
TEMPORARY INVESTMENTS — During periods of adverse market or economic conditions, a Fund may temporarily invest all or a substantial portion of its assets in high-quality, fixed-income securities, money market instruments, and shares of money market mutual funds, or it may hold cash. At such times, a Fund would not be pursuing its stated investment objective with its usual investment strategies. A Fund may also hold these investments for liquidity purposes. Fixed-income securities will be deemed to be of high quality if they are rated “A” or better by S&P or Moody’s or, if unrated, are determined to be of comparable quality by the Adviser. Money market instruments are high-quality, short-term fixed income obligations (which generally have remaining maturities of one year or less), and may include U.S. Government Securities, commercial paper, certificates of deposit and banker’s acceptances issued by domestic branches of United States banks that are members of the Federal Deposit Insurance Corporation, and repurchase agreements for US. Government Securities. In lieu of purchasing money market instruments, a Fund may purchase shares of money market mutual funds that invest primarily in U.S. Government Securities and repurchase agreements involving those securities, subject to certain limitations imposed by the 1940 Act. A Fund, as an investor in a money market fund, will indirectly bear the fees and expenses of the money market fund. These indirect fees and expenses will be in addition to the fees and expenses of the Funds. Repurchase agreements involve certain risks not associated with direct investments in debt securities.
3. INVESTMENT adviser and other services
Each Fund pays all of its expenses other than those expressly assumed by Motley Fool Asset Management, LLC (the “Adviser”). Expenses of each Fund are deducted from the Fund’s total income before dividends are paid. Subject to the supervision of the Board, the Adviser manages the overall investment operations of each Fund in accordance with the Fund’s respective investment objective and policies and formulates a continuing investment strategy for each Fund pursuant to the terms of the Investment Advisory Agreements between the Adviser and the Company on behalf of each Fund. The Adviser is a wholly-owned subsidiary of Motley Fool Investment Management, LLC, which is a wholly owned subsidiary of The Motley Fool Holdings Inc. (“TMF Holdings”), a multimedia financial-services holding company that also owns The Motley Fool, which publishes investment information and analysis across a wide range of media, including investment newsletter services, websites, and books. TMF Holdings is controlled by David Gardner and Tom Gardner, along with other private shareholders. Each Fund compensates the Adviser with a unitary management fee for its services at an annual rate based on each Fund’s average daily net assets (the “Advisory Fee”), payable on a monthly basis in arrears, as shown on the following table. From the Advisory Fee, the Adviser pays most of the expenses of each Fund, including the cost of transfer agency, custody, fund administration, legal, audit and other services. However, the Adviser is not responsible for interest expenses, brokerage commissions and other trading expenses, taxes and other extraordinary costs such as litigation and other expenses not incurred in the ordinary course of business.
FUND |
ADVISORY FEE |
|||
Global Opportunities Fund |
0.85 | % | ||
Mid-Cap Growth Fund |
0.85 | % | ||
Fool 100 Fund |
0.50 | % | ||
Small-Cap Growth Fund |
0.85 | % | ||
Capital Efficiency Fund |
0.50 | % | ||
Next Fund |
0.50 | % |
Effective December 3, 2021, the outstanding Investor Class Shares of the Global Opportunities Fund and Mid-Cap Growth Fund were converted into Institutional Class Shares of each Fund. Prior to that date, the Adviser had contractually agreed to maintain Expense Caps for Investor Class Shares and Institutional Class Shares of the Funds of 1.15% and 0.95%, respectively.
83 |
Motley Fool Asset Management ETFs
Notes to Financial Statements (continued)
AUGUST 31, 2022
During the current fiscal period, investment advisory fees accrued were as follows:
FUND |
GROSS
ADVISORY |
RECOUPMENT/ |
NET
ADVISORY |
|||||||||
Global Opportunities Fund |
$ | 4,720,440 | $ | (9,581 | ) | $ | 4,710,859 | |||||
Mid-Cap Growth Fund |
2,259,426 | 26,071 | 2,285,497 | |||||||||
Fool 100 Fund |
2,481,677 | — | 2,481,677 | |||||||||
Small-Cap Growth Fund |
1,060,744 | — | 1,060,744 | |||||||||
Capital Efficiency Fund |
42,809 | — | 42,809 | |||||||||
Next Fund |
99,316 | — | 99,316 |
U.S. Bancorp Fund Services, LLC (“Fund Services”), doing business as U.S. Bank Global Fund Services, serves as administrator for the Funds. For providing administrative and accounting services, Fund Services is entitled to receive a monthly fee, subject to certain minimum and out of pocket expenses.
Fund Services serves as the Funds’ transfer and dividend disbursing agent. For providing transfer agent services, Fund Services is entitled to receive a monthly fee, subject to certain minimum and out of pocket expenses.
U.S. Bank, N.A. (the “Custodian”) provides certain custodial services to the Funds. The Custodian is entitled to receive a monthly fee, subject to certain minimum and out of pocket expenses.
Foreside Funds Distributors, LLC (“Foreside”) serves as the principal underwriter and distributor of the Global Opportunities Fund’s shares and Mid-Cap Growth Fund’s shares pursuant to a Distribution Agreement with RBB.
Quasar Distributors, LLC (“Quasar”), a wholly-owned broker-dealer subsidiary of Foreside Financial Group, LLC, serves as the principal underwriter and distributor of the Fool 100 Fund’s shares, Small-Cap Growth Fund’s shares, Capital Efficiency Fund’s shares and Next Fund’s shares pursuant to a Distribution Agreement with RBB.
Under the Fund’s unitary fee, the Adviser compensates Fund Services and the Custodian for its services provided.
DIRECTOR AND OFFICER COMPENSATION — The Directors of the Company receive an annual retainer and meeting fees for meetings attended. An employee of Vigilant Compliance, LLC serves as Chief Compliance Officer of the Company and served as President of the Company until August 2022. Vigilant Compliance, LLC is compensated for the services provided to the Company. Employees of RBB serve as President, Chief Financial Officer, Chief Operating Officer, Secretary and Director of Marketing & Business Development of the Company. They are compensated for services provided. Certain employees of Fund Services serve as officers of the Company. They are not compensated by the Funds or the Company. Until October 1, 2020, an employee of Vigilant Compliance, LLC served as Chief Compliance Officer of the Adviser. Neither the Funds nor the Company compensated this individual or Vigilant Compliance, LLC for the services provided to Motley Fool Asset Management. For Director and Officer compensation amounts, please refer to the Statements of Operations.
SHAREHOLDER SERVICING FEE — Prior to December 3, 2021, the Global Opportunities Fund and Mid-Cap Growth Fund had entered into a shareholder servicing agreement (the “Agreement”) with the Adviser, under which the Adviser provides, or arranges for others to provide, certain specified shareholder services. As compensation for the provision of shareholder services, the Funds may pay servicing fees up to an annual rate of 0.20% of the average daily net assets of the Investor Shares. Payments to the Adviser under the Agreement may reimburse the Adviser for payments it makes to selected brokers, dealers and administrators which have entered into service agreements with the Adviser for services provided to shareholders of the Funds. The services provided by such intermediaries are primarily designed to assist shareholders of the Funds and include the furnishing of office space and equipment, telephone facilities, personnel, and assistance to the Fund in servicing such shareholders. Services provided by such intermediaries also include the provision of support services to the Funds and include establishing and maintaining
84 |
Motley Fool Asset Management ETFs
Notes to Financial Statements (continued)
AUGUST 31, 2022
shareholders’ accounts and record processing, purchase and redemption transactions, answering routine client inquiries regarding the Funds, and providing such other personal services to shareholders as the Funds may reasonably request. During the current fiscal period, the Funds incurred shareholder servicing fees as follows:
FUND |
SHAREHOLDER
|
|||
Global Opportunities Fund – Investor Shares |
$ | 121,437 | ||
Mid-Cap Growth Fund – Investor Shares |
38,618 |
REDEMPTION FEE — Prior to January 1, 2018, the Global Opportunities Fund and Mid-Cap Growth Fund imposed a redemption fee of 2.00% on redemptions/exchanges of Fund shares held less than 90 days. The redemption fee was calculated as a percentage of the net asset value of the total redemption proceeds and was retained by the Funds and accounted for as additional paid-in capital. Effective January 1, 2018, the Funds have eliminated their redemption fees. Please see the Funds’ prospectus for more information.
TRANSACTIONS WITH AFFILIATES — Advisers to investment companies, including the Motley Fool Asset Management Funds, are permitted under 17a-7 of the 1940 Act to purchase or sell securities directly between affiliated clients. When affecting these “cross” transactions, Rule 17a-7 imposes restrictions on how the trades are processed and reported. The specified conditions within Rule 17a-7 are outlined in procedures established by or under the direction of the Board of Directors. The procedures have been designed to provide assurance that any purchase or sale of securities by the Fund from or to another Fund complies with Rule 17a-7 under the 1940 Act.
During the current fiscal period, the Funds did not engage in any security transactions with affiliates.
4. PURCHASES AND SALES OF INVESTMENT SECURITIES
During the current fiscal period, aggregate purchases and sales and maturities of investment securities (excluding in-kind transactions and short-term investments) of the Funds were as follows:
FUND |
PURCHASES |
SALES |
||||||
Global Opportunities Fund |
$ | 77,164,411 | $ | 79,251,506 | ||||
Mid-Cap Growth Fund |
5,590,638 | 27,297,252 | ||||||
Fool 100 Fund |
75,047,564 | 75,328,819 | ||||||
Small-Cap Growth Fund |
12,830,822 | 18,866,888 | ||||||
Capital Efficiency Fund |
2,847,829 | 2,261,679 | ||||||
Next Fund |
4,585,360 | 3,242,001 |
There were no purchases or sales of long-term U.S. Government Securities during the current fiscal period.
During the current fiscal period, aggregate purchases and sales and maturities of in-kind transactions of the Funds were as follows:
FUND |
PURCHASES |
SALES |
||||||
Global Opportunities Fund |
$ | — | $ | 59,866,195 | ||||
Mid-Cap Growth Fund |
— | 27,476,542 | ||||||
Fool 100 Fund |
40,741,828 | 43,127,911 | ||||||
Small-Cap Growth Fund |
2,650,775 | 48,711,747 | ||||||
Capital Efficiency Fund |
23,586,806 | 1,158,288 | ||||||
Next Fund |
38,243,694 | 341,628 |
85 |
Motley Fool Asset Management ETFs
Notes to Financial Statements (continued)
AUGUST 31, 2022
5. Federal Income tax information
The Funds have followed the authoritative guidance on accounting for and disclosure of uncertainty in tax positions, which requires the Funds to determine whether a tax position is more likely than not to be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits of the position. The Funds have determined that there was no effect on the financial statements from following this authoritative guidance. In the normal course of business, the Funds are subject to examination by federal, state and local jurisdictions, where applicable, for tax years for which applicable statutes of limitations have not expired. Since the Capital Efficiency Fund and Next Fund did not have a full fiscal year, the tax cost of investments is the same as noted in the Schedule of Investments.
As of August 31, 2022, the federal tax cost, aggregate gross unrealized appreciation and depreciation of securities held by the Funds were as follows:
FUND |
FEDERAL
|
UNREALIZED |
UNREALIZED |
NET
UNREALIZED |
||||||||||||
Global Opportunities Fund |
$ | 299,887,575 | $ | 193,641,843 | $ | (26,974,236 | ) | $ | 166,667,607 | |||||||
Mid-Cap Growth Fund |
154,978,563 | 95,591,547 | (9,557,307 | ) | 86,034,240 | |||||||||||
Fool 100 Fund |
346,104,539 | 123,076,386 | (30,874,055 | ) | 92,202,331 | |||||||||||
Small-Cap Growth Fund |
115,340,590 | 7,601,478 | (27,728,730 | ) | (20,127,252 | ) | ||||||||||
Capital Efficiency Fund |
22,911,589 | 574,023 | (2,749,476 | ) | (2,175,453 | ) | ||||||||||
Next Fund |
38,887,385 | 1,392,214 | (7,613,889 | ) | (6,221,675 | ) |
Distributions to shareholders, if any, from net investment income and realized gains are determined in accordance with federal income tax regulations, which may differ from net investment income and realized gains recognized for financial reporting purposes. Accordingly, the character of distributions and composition of net assets for tax purposes may differ from those reflected in the accompanying financial statements. To the extent these differences are permanent, such amounts are reclassified within the capital accounts based on the tax treatment; temporary differences do not require such reclassification.
The following permanent differences as of August 31, 2022, primarily attributable to foreign currency transactions and in-kind redemptions gains, were reclassified among the following accounts:
FUND |
DISTRIBUTABLE
|
PAID-IN |
||||||
Global Opportunities Fund |
$ | (26,462,033 | ) | $ | 26,462,033 | |||
Mid-Cap Growth Fund |
(12,729,248 | ) | 12,729,248 | |||||
Fool 100 Fund |
(20,166,702 | ) | 20,166,702 | |||||
Small-Cap Growth Fund |
(12,327,921 | ) | 12,327,921 | |||||
Capital Efficiency Fund |
68,394 | (68,394 | ) | |||||
Next Fund |
18,930 | (18,930 | ) |
86 |
Motley Fool Asset Management ETFs
Notes to Financial Statements (continued)
AUGUST 31, 2022
As of August 31, 2022, the components of distributable earnings on a tax basis were as follows:
FUND |
UNDISTRIBUTED |
UNDISTRIBUTED |
CAPITAL
Loss |
Post
October |
UNREALIZED |
Total |
||||||||||||||||||
Global Opportunities Fund |
$ | — | $ | 330,055 | $ | — | $ | — | $ | 166,667,607 | $ | 166,997,662 | ||||||||||||
Mid-Cap Growth Fund |
— | — | — | (597,461 | ) | 86,034,240 | 85,436,779 | |||||||||||||||||
Fool 100 Fund |
982,823 | — | (7,662,331 | ) | — | 92,202,331 | 85,522,823 | |||||||||||||||||
Small-Cap Growth Fund |
— | — | (953,492 | ) | (381,671 | ) | (20,127,252 | ) | (21,462,415 | ) | ||||||||||||||
Capital Efficiency Fund |
42,783 | — | (43,550 | ) | — | (2,175,453 | ) | (2,176,220 | ) | |||||||||||||||
Next Fund |
50,952 | — | (230,350 | ) | — | (6,221,675 | ) | (6,401,073 | ) |
The differences between the book and tax basis components of distributable earnings relate primarily to the timing of recognition of income and gains for federal income tax purposes.
The tax character of dividends and distributions paid during the fiscal years ended August 31, 2022 and August 31, 2021 was as follows:
FUND |
Tax
|
ORDINARY |
LONG-TERM |
TOTAL |
||||||||||||
Global Opportunities Fund |
2022 | $ | 13,281,199 | $ | 34,767,880 | $ | 48,049,079 | |||||||||
2021 | 254,531 | 38,103,932 | 38,358,463 | |||||||||||||
Mid-Cap Growth Fund |
2022 | — | 20,813,933 | 20,813,933 | ||||||||||||
2021 | — | 32,831,307 | 32,831,307 | |||||||||||||
Fool 100 Fund |
2022 | 309,330 | 1,016,460 | 1,325,790 | ||||||||||||
2021 | 1,067,239 | 562,320 | 1,629,559 | |||||||||||||
Small-Cap Growth Fund |
2022 | — | 3,829,540 | 3,829,540 | ||||||||||||
2021 | 454,925 | 7,916,932 | 8,371,857 | |||||||||||||
Capital Efficiency Fund |
2022 | — | — | — | ||||||||||||
Next Fund |
2022 | — | — | — |
Dividends from net investment income and short-term capital gains are treated as ordinary income dividends for federal income tax purposes.
Pursuant to federal income tax rules applicable to regulated investment companies, the Funds may elect to treat certain capital losses between November 1 and August 31 and late year ordinary losses ((i) ordinary losses between January 1 and August 31, and (ii) specified ordinary and currency losses between November 1 and August 31) as occurring on the first day of the following tax year. For the fiscal year ended August 31, 2022, any amount of losses elected within the tax return will not be recognized for federal income tax purposes until September 1, 2022. The Mid-Cap Growth Fund and Small-Cap Growth Fund deferred $514,142 post October loss and $83,319 late-year loss and $185,190 post October loss and $196,481 late-year loss, respectively, which will be treated as arising on the first business day of the following fiscal year.
87 |
Motley Fool Asset Management ETFs
Notes to Financial Statements (CONTINUED)
AUGUST 31, 2022
Under the Regulated Investment Company Modernization Act of 2010, the Funds are permitted to carry forward capital losses incurred in taxable years beginning after December 22, 2010 for an unlimited period. Additionally, capital losses that are carried forward will retain their character as either short-term or long-term capital losses rather than being considered all short-term as under the previous law. As of August 31, 2022, the Fool 100 Fund, Small-Cap Growth Fund, Capital Efficiency Fund and Next Fund had unexpiring short-term losses of $7,662,331, $953,492, $43,550 and $230,350, respectively.
6. SHARE TRANSACTIONS
Shares of the Global Opportunities Fund, Mid-Cap Growth Fund, Fool 100 Fund and Small-Cap Growth Fund are listed and trade on the Cboe BZX Exchange, Inc. Shares of the Capital Efficiency Fund and Next Fund are listed and trade on the NYSE, Arca, Inc. Market prices for the shares may be different from their NAV. Each Fund issues and redeems shares on a continuous basis at NAV only in blocks of 25,000 shares, called “Creation Units.” Creation Units are issued and redeemed principally in-kind for securities included in a specified universe. Once created, shares generally trade in the secondary market at market prices that change throughout the day. Except when aggregated in Creation Units, shares are not redeemable securities of each Fund. Creation Units may only be purchased or redeemed by certain financial institutions (“Authorized Participants”). An Authorized Participant is either (i) a broker-dealer or other participant in the clearing process through the Continuous Net Settlement System of the National Securities Clearing Corporation or (ii) a Depository Trust Company participant and, in each case, must have executed a Participant Agreement with the Distributor. Most retail investors do not qualify as Authorized Participants nor have the resources to buy and sell whole Creation Units. Therefore, they are unable to purchase or redeem shares directly from each Fund. Rather, most retail investors may purchase shares in the secondary market with the assistance of a broker and are subject to customary brokerage commissions or fees.
Each Fund currently offers one class of shares, which has no front-end sales load, no deferred sales charge, and no redemption fee. A fixed transaction fee is imposed for the transfer and other transaction costs associated with the purchase or sale of Creation Units. The standard fixed transaction fee for each Fund is $250, payable to the custodian. In addition, a variable fee may be charged on all cash transactions or substitutes for Creation Units of up to a maximum of 2% as a percentage of the value of the Creation Units subject to the transaction. Variable fees are imposed to compensate each Fund for the transaction costs associated with the cash transactions. Variable fees received by each Fund, if any, are displayed in the capital shares transactions section of the Statements of Changes in Net Assets. Each Fund may issue an unlimited number of shares of beneficial interest, with $0.001 par value per share. Shares of each Fund have equal rights and privileges.
7. SECURITIES LENDING
The Funds may make secured loans of their portfolio securities to brokers, dealers and other financial institutions to earn additional income and receive cash collateral equal to at least 100% of the current market value of the loaned securities, as marked to market each day that the NAV of the Funds is determined. When the collateral falls below specified amounts, the Funds’ lending agent will use its best effort to obtain additional collateral on the next business day to meet required amounts under the security lending agreement. The Funds will pay administrative and custodial fees in connection with the loan of securities. Collateral is invested in short-term investments and the Funds will bear the risk of loss of the invested collateral. Investments purchased with proceeds from securities lending are overnight and continuous. Securities lending will expose the Funds to the risk of loss should a borrower default on its obligation to return the borrowed securities. The market value of the securities on loan and cash collateral as of the end of the reporting period and the income generated from the program during the current fiscal period with respect to such secured loans were as follows:
FUND |
MARKET
VALUE |
MARKET
VALUE |
INCOME
|
|||||||||
Global Opportunities Fund |
$ | 32,824,775 | $ | 33,805,832 | $ | 450,755 | ||||||
Mid-Cap Growth Fund |
30,222,704 | 31,234,388 | 39,668 | |||||||||
Fool 100 Fund |
20,543,351 | 21,230,044 | 43,353 | |||||||||
Small-Cap Growth Fund |
16,722,909 | 17,127,093 | 34,085 |
88 |
Motley Fool Asset Management ETFs
Notes to Financial Statements (continued)
AUGUST 31, 2022
Securities lending transactions are entered into by the Funds’ securities lending agent on behalf of the Funds under a Master Securities Lending Agreement (“MSLA”) which permits the Funds’ securities lending agent on behalf of the Funds under certain circumstances including an event of default (such as bankruptcy or insolvency), to offset amounts payable on behalf of the Funds to the same counterparty against amounts to be received and create one single net payment due to or from the Funds. The following table is a summary of the Funds’ open securities lending transactions which are subject to a MSLA as of the end of the reporting period:
GROSS
AMOUNTS NOT OFFSET IN THE |
||||||||||||||||||||||||
FUND |
GROSS
|
GROSS
|
NET
AMOUNTS |
FINANCIAL
|
CASH
|
NET
|
||||||||||||||||||
Global Opportunities Fund |
$ | 32,824,775 | $ | — | $ | 32,824,775 | $ | (32,824,775 | ) | $ | — | $ | — | |||||||||||
Mid-Cap Growth Fund |
30,222,704 | — | 30,222,704 | (30,222,704 | ) | — | — | |||||||||||||||||
Fool 100 Fund |
20,543,351 | — | 20,543,351 | (20,543,351 | ) | — | — | |||||||||||||||||
Small-Cap Growth Fund |
16,722,909 | — | 16,722,909 | (16,722,909 | ) | — | — |
1 |
Amount disclosed is limited to the amount of assets presented in the Statements of Assets and Liabilities. Actual collateral received may be more than the amount shown. |
2 |
Net amount represents the net amount receivable from the counterparty in the event of default. |
8. NEW ACCOUNTING PRONOUNCEMENTS AND REGULATORY UPDATES
In October 2020, the Securities and Exchange Commission (“SEC”) adopted new regulations governing the use of derivatives by registered investment companies (“Rule 18f-4”). Rule 18f-4 imposes limits on the amount of derivatives a fund can enter into, eliminates the asset segregation framework previously used by funds to comply with Section 18 of the 1940 Act, and requires funds whose use of derivatives is greater than a limited specified amount to establish and maintain a comprehensive derivatives risk management program and appoint a derivatives risk manager. The Funds are required to comply with Rule 18f-4 and have adopted procedures for investing in derivatives and other transactions in compliance with Rule 18f-4. Rule 18f-4 may require the Funds to observe more stringent requirements than were previously imposed by the 1940 Act, which could adversely affect the ability of the Funds to engage in certain derivatives transactions and/or increase the costs of such derivatives transactions, which could adversely affect the Funds’ performance and increase costs related to the Funds’ use of derivatives.
In December 2020, the SEC adopted a new rule providing a framework for fund valuation practices (“Rule 2a-5”). Rule 2a-5 establishes requirements for determining fair value in good faith for purposes of the 1940 Act. Rule 2a-5 will permit fund boards to designate certain parties to perform fair value determinations, subject to board oversight and certain other conditions. Rule 2a-5 also defines when market quotations are “readily available” for purposes of the 1940 Act and the threshold for determining whether a fund must fair value a security. In connection with Rule 2a-5, the SEC also adopted related recordkeeping requirements and is rescinding previously issued guidance, including with respect to the role of a board in determining fair value and the accounting
89 |
Motley Fool Asset Management ETFs
Notes to Financial Statements (CONCLUDED)
AUGUST 31, 2022
and auditing of fund investments. The Funds will be required to comply with the rules by September 8, 2022. Effective September 8, 2022 and pursuant to the requirements of Rule 2a-5, the Board designated the Adviser as its valuation designee to perform fair value determinations and approved new valuation procedures for the Funds.
In June 2022, the FASB issued Accounting Standards Update 2022-03, which amends Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions (“ASU 2022-03”). ASU 2022-03 clarifies guidance for fair value measurement of an equity security subject to a contractual sale restriction and establishes new disclosure requirements for such equity securities. ASU 2022-03 is effective for fiscal years beginning after December 15, 2023 and for interim periods within those fiscal years, with early adoption permitted. Management is currently evaluating the impact of these amendments on the financial statements.
9. Subsequent Events
Management has evaluated the impact of all subsequent events on the Funds through the date the financial statements were issued and has determined that there were no significant events requiring recognition or disclosure in the financial statements.
90 |
Motley Fool Asset Management ETFs
Report
of Independent Registered
Public Accounting Firm
To
the Board of Directors of
The RBB Fund, Inc.
and the Shareholders of the
Motley Fool ETFs
Opinion on the Financial Statements
We have audited the accompanying statements of assets and liabilities of the Motley Fool Global Opportunities ETF (formerly MFAM Global Opportunities Fund), Motley Fool Mid-Cap Growth ETF (formerly MFAM Mid-Cap Growth Fund), Motley Fool 100 Index ETF, Motley Fool Small-Cap Growth ETF (formerly MFAM Small-Cap Growth ETF), Motley Fool Capital Efficiency 100 Index ETF, and Motley Fool Next Index ETF (the “Funds”), each a series of The RBB Fund, Inc., including the schedules of investments, as of August 31, 2022, the related statements of operations, the statements of changes in net assets and the financial highlights for each of the periods indicated in the table below, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Funds as of August 31, 2022, the results of their operations, the changes in their net assets, and their financial highlights for the periods indicated in the table below, in conformity with accounting principles generally accepted in the United States of America.
Individual
Funds |
Statement
of |
Statements
of |
Financial highlights |
Motley Fool Global Opportunities ETF and Motley Fool Mid-Cap Growth ETF |
For the year ended August 31, 2022 |
For each of the two years in the period ended August 31, 2022 |
For each of the five years in the period ended August 31, 2022 |
Motley Fool 100 Index ETF |
For the year ended August 31, 2022 |
For each of the two years in the period ended August 31, 2022 |
For
each of the four years in the period ended |
Motley Fool Small-Cap Growth ETF |
For the year ended August 31, 2022 |
For each of the two years in the period ended August 31, 2022 |
For each of the three years in the period ended August 31, 2022 and for the period October 29, 2018 (commencement of operations) through August 31, 2019 |
Motley Fool Capital Efficiency 100 Index ETF and Motley Fool Next Index ETF |
For the period December 30, 2021 (commencement of operations) through August 31, 2022 |
For the period December 30, 2021 (commencement of operations) through August 31, 2022 |
For the period December 30, 2021 (commencement of operations) through August 31, 2022 |
Basis for Opinion
These financial statements are the responsibility of the Fund’s management. Our responsibility is to express an opinion on the Funds’ financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Funds in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We have served as the auditor of one or more of the funds in the Trust since 2011.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of the Funds’ internal control over
91 |
Motley Fool Asset Management ETFs
Report
of Independent Registered
Public Accounting Firm (CONCLUDED)
financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Funds’ internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of August 31, 2022 by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
TAIT, WELLER & BAKER LLP |
Philadelphia,
Pennsylvania
October 28, 2022
92 |
Motley Fool Asset Management ETFs
Shareholder Tax Information
(Unaudited)
Certain tax information regarding the Funds is required to be provided to shareholders based upon the Funds’ income and distributions for the taxable period ended August 31, 2022. The information and distributions reported herein may differ from information and distributions taxable to the shareholders for the calendar year ending December 31, 2022. During the fiscal year ended August 31, 2022, the following dividends and distributions were paid by the Funds:
FUND |
ORDINARY
|
LONG-TERM
|
Global Opportunities Fund |
$ 13,281,199 |
$ 34,767,880 |
Mid-Cap Growth Fund |
— |
20,813,933 |
Fool 100 Fund |
309,330 |
1,016,460 |
Small-Cap Growth Fund |
— |
3,829,540 |
Capital Efficiency Fund |
— |
— |
Next Fund |
— |
— |
Dividends from net investment income and short-term capital gains are treated as ordinary income dividends for federal income tax purposes.
Under the Jobs and Growth Tax relief Reconciliation Act of 2003 the following percentages of ordinary dividends paid during the fiscal year ended August 31, 2022 are designated as “qualified dividend income,” as defined in the Act, and are subject to reduced tax rates:
Global Opportunities Fund |
100.00% |
Mid-Cap Growth Fund |
0.00% |
Fool 100 Fund |
100.00% |
Small-Cap Growth Fund |
0.00% |
Capital Efficiency Fund |
0.00% |
Next Fund |
0.00% |
The percentage of total ordinary income dividends paid qualifying for the corporate dividends received deduction for the Funds are as follows:
Global Opportunities Fund |
14.42% |
Mid-Cap Growth Fund |
0.00% |
Fool 100 Fund |
100.00% |
Small-Cap Growth Fund |
0.00% |
Capital Efficiency Fund |
0.00% |
Next Fund |
0.00% |
Because the Funds’ fiscal year is not the calendar year, another notification will be sent with respect to calendar year 2023. The second notification, which will reflect the amount, if any, to be used by calendar year taxpayers on their U.S. federal income tax returns, will be made in conjunction with Form 1099-DIV and will be mailed in January 2023.
Foreign shareholders will generally be subject to U.S. withholding tax on the amount of their ordinary income dividends. They will generally not be entitled to a foreign tax credit or deduction for the withholding taxes paid by the Funds, if any.
In general, dividends received by tax-exempt recipients (e.g., IRAs and Keoghs) need not be reported as taxable income for U.S. federal income tax purposes. However, some retirement trusts (e.g., corporate, Keogh and 403(b)(7) plans) may need this information for their annual information reporting.
Shareholders are advised to consult their own tax advisers with respect to the tax consequences of their investment in the Funds.
93 |
Motley Fool Asset Management ETFs
Notice to Shareholders
(Unaudited)
Information on Proxy Voting
Policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities as well as information regarding how the Funds voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 are available (i) without charge, upon request, by calling (888) 863-8803; and (ii) on the SEC’s website at http://www.sec.gov.
Quarterly Schedule of Investments
The Company files a complete schedule of portfolio holdings with the SEC for the first and third fiscal quarters of each fiscal year (quarters ended November 30 and May 31) as an exhibit to its report on Form N-PORT. The Company’s Form N-PORT are available on the SEC’s website at http://www.sec.gov.
APPROVAL OF INVESTMENT ADVISORY AGREEMENT
As required by the 1940 Act, the Board of the Company, including all of the Directors who are not “interested persons” of the Company, as that term is defined in the 1940 Act (the “Independent Directors”), considered the renewal of the investment advisory agreements between Motley Fool Asset Management, LLC (“MFAM”) and the Company (the “Investment Advisory Agreements”) on behalf of the Motley Fool 100 Index ETF and the Motley Fool Small-Cap Growth ETF (for this section only, each a “Fund” and collectively the “Funds”), at a meeting of the Board held on May 11-12, 2022 (the “Meeting”). At the Meeting, the Board, including all of the Independent Directors, approved the Investment Advisory Agreement for an additional one-year term. The Board’s decision to approve the Investment Advisory Agreement reflects the exercise of its business judgment to continue the existing arrangements. In approving the Investment Advisory Agreement, the Board considered information provided by MFAM with the assistance and advice of counsel to the Independent Directors and the Company.
In considering the renewal and approval of the Investment Advisory Agreements between the Company and MFAM with respect to the Funds, the Directors took into account all the materials provided prior to and during the Meeting and at other meetings throughout the past year, the presentations made during the Meeting, and the discussions held during the Meeting. Among other things, the Directors considered (i) the nature, extent, and quality of MFAM’s services provided to the Funds; (ii) descriptions of the experience and qualifications of MFAM’s personnel providing those services; (iii) MFAM’s investment philosophies and processes; (iv) MFAM’s assets under management and client descriptions; (v) MFAM’s soft dollar commission and trade allocation policies, including information on the types of research and services obtained in connection with soft dollar commissions; (vi) MFAM’s advisory fee arrangement with the Company and other similarly managed clients; (vii) MFAM’s compliance policies and procedures; (viii) MFAM’s financial information, insurance coverage and profitability analysis related to providing advisory services to the Funds; (ix) the extent to which economies of scale are relevant to the Funds; (x) a report prepared by Broadridge/Lipper comparing each Fund’s management fees and total expense ratio to those of its Lipper peer group; and (xi) a report comparing the performance of the Funds to the performance of their respective benchmark.
As part of their review, the Directors considered the nature, extent and quality of the services provided by MFAM. The Directors concluded that MFAM had substantial resources to provide services to the Funds and that MFAM’s services had been acceptable.
The Directors also considered the investment performance of the Funds and MFAM. The Directors considered the Funds’ investment performance in light of their investment objectives and investment strategies. The Directors concluded that the investment performance of each of the Funds as compared to their respective benchmarks and Lipper Groups was acceptable.
The Directors then noted the performance of the Motley Fool 100 Index ETF. The Directors considered that because the Fund was designed to track the performance of its index, the relevant consideration was the extent to which the Fund tracked its index before fees and expenses. The Board also noted that the performance of the index did not take into account the expenses incurred when purchasing or selling securities, which expenses would lower the performance of a fund seeking to replicate some or all of the holdings of the index. The Board noted that for the year-to-date, one-year, three-year and since-inception periods ended March 31, 2022, the Fund’s performance was in line with its index before fees and expenses. The Directors also noted that the Motley Fool 100 Index ETF ranked in the 1st quintile in its Lipper Performance Group for the two-year, three-year, and since-inception periods ended December 31, 2021.
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(Unaudited)
Finally, the Directors noted the MFAM Small-Cap Growth ETF had outperformed its benchmark for the three-year and since-inception periods, and underperformed its benchmark for the year-to-date and one-year periods, each ended March 31, 2022. The Directors also noted that the MFAM Small-Cap Growth ETF ranked in the 1st quintile in its Lipper Performance Group for the two-year period, and in the 5th quintile for the one-year period, each ended December 31, 2021.
The Board also considered the advisory fee rates payable by the Funds under the Investment Advisory Agreements. In this regard, information on the fees paid by the Funds and the Funds’ total operating expense ratios (before and after fee waivers and expense reimbursements) were compared to similar information for ETFs advised by other, unaffiliated investment advisory firms.
The Directors noted that each of the actual advisor fee and total expenses of the Motley Fool 100 Index ETF ranked in the 5th quintile of its Lipper Expense Universe.
The Directors noted that the actual advisor fee of the MFAM Small-Cap Growth ETF ranked in the 5th quintile of its Lipper Expense Group, and that the total expenses of the MFAM Small-Cap Growth ETF ranked in the 4th quintile of its Lipper Expense Group.
The Board also took into consideration that the advisory fee for the Motley Fool 100 Index ETF and the MFAM Small-Cap Growth ETF was a “unitary fee,” meaning those Funds paid no expenses other than the advisory fee and certain other costs such as interest, brokerage and extraordinary expenses. The Board noted that MFAM continued to be responsible for compensating the Company’s other service providers and paying other expenses of the Motley Fool 100 Index ETF and the MFAM Small-Cap Growth ETF out of its own fees and resources.
After reviewing the information regarding the Funds’ costs, profitability and economies of scale, and after considering MFAM’s services, the Directors concluded that the investment advisory fees paid by the Funds were fair and reasonable and that the Investment Advisory Agreements should be approved and continued for an additional one year period ending August 16, 2023.
Liquidity Risk Management Program
The Company has adopted and implemented a Liquidity Risk Management Program (the “Company Program”) as required by rule 22e-4 under the 1940 Act. In accordance with the Company Program, the Adviser has adopted and implemented a liquidity risk management program (the “Adviser Program” and together with the Company Program, the “Programs”) on behalf of the Funds. The Programs seek to assess, manage and review each Fund’s Liquidity Risk. “Liquidity Risk” is defined as the risk that a Fund could not meet requests to redeem shares issued by the Fund without significant dilution of remaining investors’ interest in the Fund.
The Board has appointed Vigilant Compliance, LLC (“Vigilant”) as the program administrator for the Company Program and the Liquidity Risk Management Committee of the Adviser as the program administrator for the Adviser Program. The process of monitoring and determining the liquidity of each Fund’s investments is supported by one or more third-party vendors.
At meetings held during the current fiscal period, the Board and its Regulatory Oversight Committee received and reviewed a written report (the “Report”) of Vigilant and the Adviser concerning the operation of the Programs for the period from July 1, 2021 to December 31, 2021 (the “Period”). The Report summarized the operation of the Programs and the information and factors considered by Vigilant and the Adviser in reviewing the adequacy and effectiveness of the implementation of the Programs with respect to each Fund. Such information and factors included, among other things: (i) the methodology used to classify the liquidity of each Fund’s portfolio investments and the Adviser’s assessment that each Fund’s strategy remained appropriate for an open-end mutual fund; (ii) analyses of each Fund’s trading environment and reasonably anticipated trading size; (iii) that each Fund held primarily highly liquid assets (investments that the Fund anticipates can be converted to cash within 3 business days or less in current market conditions without significantly changing their market value); (iv) that each Fund either held a percentage of highly liquid assets above its highly liquid investment minimum at all times during the Period or did not require the establishment of a highly liquid investment minimum; (v) confirmation that none of the Funds had breached the 15% maximum illiquid security threshold (investments that cannot be sold or disposed of in seven days or less in current market conditions without the sale of the investment significantly changing the market value of the investment) during the Period and the procedures for monitoring compliance with the limit; (vi) that the processes, technologies and third-party vendors used to assess, manage, and/or periodically review each Fund’s Liquidity Risk functioned appropriately during the Period; and (vii) that the Programs operated adequately during the Period. The Report also indicated that there were no material changes made to the Programs during the Period.
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Motley Fool Asset Management ETFs
Notice to Shareholders (Concluded)
(Unaudited)
Based on the review, the Report concluded that the Programs were being implemented effectively and reasonably designed to assess and manage Liquidity Risk in each Fund’s portfolio.
There can be no assurance that the Company Program or the Adviser Program will achieve its objectives under all circumstances in the future. Please refer to the Funds’ prospectuses for more information regarding the Fund’s exposure to liquidity risk and other risks to which it may be subject.
Frequency Distributions of Premiums and Discounts
Information regarding how often shares of the Funds trade on an exchange at a price above (i.e., at a premium) or below (i.e., at a discount) the NAV of the Funds is available, without charge, on the Funds’ website at www.fooletfs.com.
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Motley Fool Asset Management ETFs
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However, you can contact us at any time to limit our sharing.
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In addition to the above information, where applicable, you have the following rights under the European Union’s General Data Protection Regulation (“GDPR”) and U.S. Privacy Laws, as applicable and to the extent permitted by law, to
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Motley Fool Asset Management ETFs
Directors and Officers
(Unaudited)
Directors and Executive Officers
The business and affairs of the Company are managed under the direction of the Company’s Board of Directors. The Company is organized under and managed pursuant to Maryland law. The Directors and executive officers of the Company, their ages, business addresses and principal occupations during the past five years are set forth below. The statement of additional information (“SAI”) includes additional information about the Directors and is available without charge, upon request, by calling (888) 863-8803.
Name, Address, AND AGE |
Positions(s) |
Term
of Office |
Principal
Occupation(s) |
Number
of |
Other |
INDEPENDENT DIRECTORS | |||||
Julian
A. Brodsky |
Director |
1988 to present |
From 1969 to 2011, Director and Vice Chairman, Comcast Corporation (cable television and communications). |
55 |
AMDOCS Limited (service provider to telecommunications companies). |
Gregory
P. Chandler |
Director |
2012 to present |
Since 2020, Chief Financial Officer, Herspiegel Consulting LLC (life sciences consulting services); 2020, Chief Financial Officer, Avocado Systems Inc. (cyber security software provider); 2009-2020, Chief Financial Officer, Emtec, Inc. (information technology consulting/services). |
55 |
FS Energy and Power Fund (business development company); Wilmington Funds (12 portfolios)(registered investment company); Emtec, Inc. (until December 2019); FS Investment Corporation (business development company) (until December 2018). |
Lisa A. Dolly 615 East Michigan Street Milwaukee, WI, 53202 Age: 56 |
Director |
October
2021 |
From July 2019-December 2019, Chairman, Pershing LLC (broker dealer, clearing and custody firm); January 2016-June 2019, Chief Executive Officer, Pershing, LLC. |
55 |
Allfunds Group PLC (United Kingdom wealthtech and fund distribution provider); Securities Industry and Financial Markets Association (trade association for broker dealers, investment banks and asset managers); Hightower Advisors (wealth management firm). |
100 |
Motley Fool Asset Management ETFs
Directors and Officers (CONTINUED)
(Unaudited)
Name, Address, AND AGE |
Positions(s) |
Term
of Office |
Principal
Occupation(s) |
Number
of |
Other |
Nicholas
A. Giordano |
Director |
2006 to present |
Since 1997, Consultant, financial services organizations. |
55 |
IntriCon Corporation (biomedical device manufacturer); Wilmington Funds (12 portfolios) (registered investment company); Independence Blue Cross (healthcare insurance) (until 2021); Kalmar Pooled Investment Trust (registered investment company) (until September 2017). |
Arnold
M. Reichman 615 East Michigan Street Milwaukee, WI 53202 |
Chairman Director |
2005 to present 1991 to present |
Retired. |
55 |
EIP Investment Trust (registered investment company) (until August 2022). |
Brian
T. Shea |
Director |
2018 to present |
From 2014-2017, Chief Executive Officer, BNY Mellon Investment Services (fund services, global custodian and securities clearing firm); from 1983-2014, Chief Executive Officer and various positions, Pershing LLC (broker dealer, clearing and custody firm). |
55 |
Fidelity National Information Services, Inc. (financial services technology company); Ameriprise Financial, Inc. (financial services company); WisdomTree Investments, Inc. (asset management company) (until March 2019). |
Robert
A. Straniere |
Director |
2006 to present |
Since 2009, Administrative Law Judge, New York City; since 1980, Founding Partner, Straniere Law Group (law firm). |
55 |
None. |
INTERESTED DIRECTOR2 | |||||
Robert
Sablowsky |
Vice Chairman Director |
2016 to present 1991 to present |
Since 2002, Senior Director – Investments and, prior thereto, Executive Vice President, of Oppenheimer & Co., Inc. (a registered broker-dealer). |
55 |
None. |
OFFICERS | |||||
Steven Plump 615 East Michigan Street Milwaukee, WI 53202 Age: 63 |
President |
Since August 2022 |
From 2011 to 2021, Executive Vice President, PIMCO Investments LLC. |
N/A |
N/A |
101 |
Motley Fool Asset Management ETFs
Directors and Officers (CONTINUED)
(Unaudited)
Name, Address, AND AGE |
Positions(s) |
Term
of Office |
Principal
Occupation(s) |
Number
of |
Other |
Salvatore
Faia, JD, CPA, CFE Vigilant Compliance, LLC Gateway Corporate Center.
Suite 216 |
Chief |
2004 to present |
Since 2004, President, Vigilant Compliance, LLC (investment management services company); since 2005, Independent Trustee of EIP Investment Trust (registered investment company); since 2021, Chief Compliance Officer of The RBB Fund Trust; President of The RBB Fund Trust from 2021 to 2022; President of The RBB Fund, Inc. from 2009 to 2022. |
N/A |
N/A |
James
G. Shaw |
Chief Financial Officer and Secretary
Chief Operating Officer |
2016 to present
2022 to present |
Chief Financial Officer and Secretary (since 2016) and Chief Operating Officer (since 2022) of The RBB Fund, Inc.; Chief Financial Officer and Secretary (since 2021) and Chief Operating Officer (since 2022) of The RBB Fund Trust; from 2005 to 2016, Assistant Treasurer of The RBB Fund, Inc.; from 1995 to 2016, Senior Director and Vice President of BNY Mellon Investment Servicing (US) Inc. (financial services company). |
N/A |
N/A |
Craig
A. Urciuoli |
Director of Marketing & Business Development |
2019 to present |
Director of Marketing & Business Development of The RBB Fund, Inc. (since 2019) and The RBB Fund Trust (since 2021); from 2000-2019, Managing Director, Third Avenue Management LLC (an investment advisory firm). |
N/A |
N/A |
Jennifer
Witt |
Assistant Treasurer |
2018 to present |
Since 2020, Vice President, U.S. Bank Global Fund Services (fund administrative services firm); from 2016 to 2020, Assistant Vice President, U.S. Bank Global Fund Services; from 2007 to 2016, Supervisor, Nuveen Investments (registered investment company). |
N/A |
N/A |
Edward
Paz |
Assistant Secretary |
2016 to present |
Since 2007, Vice President and Counsel, U.S. Bancorp Fund Services, LLC (fund administrative services firm). |
N/A |
N/A |
102 |
Motley Fool Asset Management ETFs
Directors and Officers (CONCLUDED)
(Unaudited)
Name, Address, AND AGE |
Positions(s) |
Term
of Office |
Principal
Occupation(s) |
Number
of |
Other |
Michael
P. Malloy |
Assistant Secretary |
1999 to present |
Since 1993, Partner, Faegre Drinker Biddle & Reath LLP (law firm). |
N/A |
N/A |
Jillian
L. Bosmann |
Assistant Secretary |
2017 to present |
Since 2017, Partner, Faegre Drinker Biddle & Reath LLP (law firm). |
N/A |
N/A |
* |
Each Director oversees 55 portfolios of the fund complex, consisting of the series in the Company and The RBB Fund Trust (7 portfolios). |
1. |
Subject to the Company’s Retirement Policy, each Director may continue to serve as a Director until the last day of the calendar year in which the applicable Director attains age 75 or until his or her successor is elected and qualified or his or her death, resignation or removal. The Board reserves the right to waive the requirements of the Policy with respect to an individual Director. The Board has approved waivers of the policy with respect to Messrs. Brodsky, Giordano, Sablowsky and Straniere. Each officer holds office at the pleasure of the Board until the next special meeting of the Company or until his or her successor is duly elected and qualified, or until he or she dies, resigns or is removed. |
2. |
Mr. Sablowsky is considered an “interested person” of the Company as that term is defined in the 1940 Act and is referred to as an “Interested Director.” Mr. Sablowsky is considered an “Interested Director” of the Company by virtue of his position as an employee of Oppenheimer & Co., Inc., a registered broker-dealer. |
Director Experience, Qualifications, Attributes and/or Skills
The information above includes each Director’s principal occupations during the last five years. Each Director possesses extensive additional experience, skills and attributes relevant to his or her qualifications to serve as a Director. The cumulative background of each Director led to the conclusion that each Director should serve as a Director of the Company. Mr. Brodsky has over 40 years of senior executive-level management experience in the cable television and communications industry. Mr. Chandler has demonstrated leadership and management abilities as evidenced by his senior executive level positions in the investment technology consulting/services and investment banking/brokerage industries, and also serves on various boards. Ms. Dolly has over three decades of experience in the financial services industry, and she has demonstrated her leadership and management abilities by serving in numerous senior executive-level positions. Mr. Giordano has years of experience as a consultant to financial services organizations and also serves on the boards of other registered investment companies. Mr. Reichman brings decades of investment management experience to the Board, in addition to senior executive-level management experience. Mr. Sablowsky has demonstrated leadership and management abilities as evidenced by his senior executive-level positions in the financial services industry. Mr. Shea has demonstrated leadership and management abilities as evidenced by his senior executive-level positions in the brokerage, clearing, and investment services industry, including service on the boards of industry regulatory organizations and a university. Mr. Straniere has been a practicing attorney for over 30 years and has served on the boards of an asset management company and another registered investment company.
103 |
Investment Adviser
Motley
Fool Asset Management, LLC
2000 Duke Street
Suite 275
Alexandria, VA
22314
Administrator and Transfer Agent
U.S.
Bancorp Fund Services, LLC
P.O. Box 701
Milwaukee, WI 53201
Custodian
U.S.
Bank, N.A.
1555 North Rivercenter Drive, Suite 302
Milwaukee, WI 53212
Principal Underwriters
Quasar
Distributors, LLC
111 E Kilbourn Ave, Suite 2200
Milwaukee, WI 53202
Foreside
Funds Distributors, LLC
899 Cassatt Road
400 Berwyn Park, Suite
110
Berwyn, PA 19312
Independent Registered Public Accounting Firm
Tait,
Weller & Baker LLP
Two Liberty Place
50 S 16th St. Suite
2900
Philadelphia, PA 19102-2529
Legal Counsel
Faegre
Drinker Biddle & Reath LLP
One Logan Square, Suite 2000
Philadelphia, PA 19103-6996
104 |
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