Company: EUO
Filing Date: 2025-02-13
Form Type: S-1
Source: 0001193125-25-026199
Chunk: 77

Company: ProShares Trust II
Filing Date: 2025-02-13
Form: S-1
Chunk 77
---
 of the CEA in connection with each Fund’s physically settled forward contracts. The lack of regulation in these markets could expose investors to significant losses under certain circumstances, including in the event of trading abuses or financial failure by participants. Tariffs and/or other trade sanctions may be proposed, imposed or withdrawn by the U.S. at any time. Changes in U.S. trade policy have had, and may continue to have, an impact on certain commodities markets, particularly the markets for natural gas and oil, commodity futures markets, including futures on natural gas and oil, and the prices of ProShares Ultra Bloomberg Natural Gas and ProShares UltraShort Bloomberg Natural Gas (the Natural Gas Funds) and ProShares Ultra Bloomberg Crude Oil and the ProShares UltraShort Bloomberg Crude Oil (the Oil Funds). The Natural Gas Funds and the Oil Funds are offered under different prospectuses. Regulatory and exchange daily price limits, position limits and accountability levels may have a negative impact on the operation and performance of each Fund. Many U.S. futures exchanges limit the amount of fluctuation permitted in futures contract prices during a single trading day by regulations referred to as “daily price fluctuation limits” or “daily limits.” Once the daily limit has been reached in a particular contract, no trades may be made that day at a price beyond that limit or trading may be suspended for specified periods during the trading day. Derivatives contract prices could move to a limit for several consecutive trading days with little or no trading thereby preventing prompt liquidation of or entry into derivatives positions and potentially subjecting the Fund to substantial losses or periods in which the Fund does not create additional Creation Units. In addition, the CFTC, U.S. futures exchanges and certain non-U.S. exchanges have established limits referred to as “speculative position limits” or “accountability levels” on the maximum net long or short futures positions that any person may hold or control in futures contracts traded on U.S. and certain non-U.S. exchanges. The CFTC’s rules require that all accounts owned or managed by an entity that is responsible for such accounts’ trading decisions, their principals and their affiliates be aggregated for position limits. In connection with these limits, the Dodd-Frank Act amended the Commodity Exchange Act, and as a result, the CFTC has adopted regulations establishing speculative position limits applicable to regulated futures and OTC derivatives and impose aggregate speculative position limits across regulated U.S. futures, OTC positions and certain futures contracts traded on non-U.S. exchanges. On October 15,